Don Beppinos is tiny. Great for takeaway but not so good for dining in.
Restaurant II is easily the best place in newcastle, its a bit expensive but worth it.
Theres plenty of places in the honeysuckle precinct (Engine Room, Silo, Brewery Restaurant, Twist) and most sell typical modern australian food.
The Junction has a few nice places, Lime has been mentioned, but theres also Lotus and Fuel. again, these sell modern australian.
Rosina's is a great little italian restaurant in the City. one of those hidden gems i really recommend. Il Volcano is another great italian place ive heard about but not gone there.
Theres so many more but to be honest, treat yourself and go to Restaurant II.