hey there, don't know if you're still looking for a reply but I thought I'd give it a shot?
I tried out for the con last year and was successful (yay). although I can't be certain about everything (since I don't actually work for the admissions office or anything), this is what I think:
1. Classical guitar sounds awesome. I don't know much about that instrument's quota, but if it is an option according to the website (as in, they can find out the audition requirements for the instrument) then it should be all good. If not, try contacting the con directly.
2. I don't think the AMEB requirements are extremely important if you're good enough. They usually state that auditions should be grade 7 AMEB standard minimum, but since classical guitar is a rarely examined instrument (I think), I don't know if it is much of an issue. If they are good at what they do and are willing to work hard, practise lots and continually improve, they should be in with a good chance. If anything, AMEB requirements are just a good stepping stone for performance practice and musicianship skills. Also if they take Music 2/Extension for the HSC, it should be acceptable as well.
3. The ATAR sounds good too. While ATAR is not extremely important for something like a music audition, you still need a relatively high ATAR to show that you can work hard and have a good attitude towards your studies. I think generally an 80+ ATAR is required for acceptance.
4. Yes, there are quotas on how many instrumentalists they accept, even if they don't tell you - they would look at how many they want in the degree + in the streams of the degree, as well as how many of each instrument they want. But I don't think your friend should worry too much about that - tell them to focus on their own audition and try to play the best that they can.
5. As an extra - don't forget about the music skills test. The best way to increase your chance of being successful is to be good across all 3 areas - performance/composition/musicology audition, music skills test and ATAR.
Hope that helped.