If you *can* transfer, I think you should =)
I know that if you want to transfer to UNSW law, there's an entry pathway where you do a year of commerce and if you get a high credit average/distinction and above, along with a 97+ ATAR, you can transfer (but the requirements vary from year to year depending on the level of competition obviously).
For USYD, I think you do actually need a 97+ ATAR if you want to get into the undergraduate scheme (if I remember correctly from the information day they held not so long ago), along with a pretty decent GPA (distinction+ ?)...if you get a lower ATAR but you get a fabulous GPA (high distinctions) I think there are special circumstances where they consider you... but I remember the lecturer saying that the chances are slim.
But there's always graduate law at both USYD and UNSW, in which case they take solely your GPA.
Another good law school is ANU ... but because it's in Canberra the demand for it is lower and hence the lower ATAR requirement. If you do want to transfer law schools, you should consider ANU too, I'm not sure about the requirements for non-standard/transfer applicants.
From what I've heard, what law school you graduate from *does* matter... because apparently law is a subject heavily based on your "connections" and social networks after you graduate... and USYD/UNSW tend to have great relationships with some of the top firms in Sydney (there's more info about this on the law faculty website of both universities). This is what others have told me anyway.
However, with all this being said, if you graduate from Newcastle Uni with great results, you probably will be considered equally among the USYD/UNSW graduates. I'm pretty sure ranking top of your law cohort will look impressive to employers regardless of what university you attend.
Good luck with everything ^_^