The travel issue would be worse for Newcastle and Canberra more specifically. They would be forced to play at every single venue outside of NSW under that scenario when they dont currently. A 1.5-2.5 hour bus ride is preferable to the 4-5 hour plane trips for the east coast (travel to and from the airport inclusive) and the 6-8 hour ones to the West coast and NZ.
The difference in that scenario to the current draw is much bigger than you are surmising
So they would have as much travel as the other non-Sydney clubs. Why is this a problem? Do Newcastle and Canberra deserve to have less travel than other non-Sydney teams just because they are in NSW?
And they would not have to play at every single venue outside NSW, they would only have to play the 4 in their group.
Anyway as I said it's preferable that Newcastle is in the NSW conference at the expense of a Sydney side.