LOL, no you don't have to look Aboriginal!! By the third generation most people of Indigenous heritage don't look at all Indigenous. I'm currently studying medicine at UNSW, but I got an offer for both UNSW and Newcastle through Indigenous entry.
To apply you need to have some proof of Aboriginality. Apart from that, the entry is pretty similar to mainstream entry (and is therefore competitive) - you still need to do really well in the HSC and excel in interviews and sometimes do short courses.
You need to get your applications in pretty early, so look into it, most Uni's that offer Med have some scheme for Indigenous people.
Goodluck 'snot'!