Coffeebean
My mother has had several of these visas. The answers to yourquestions are:
1. Your mother could go to Australia for an initial period of 6months. When the first six months expires, she could then go tosomewhere reasonably close (Fiji-NZ-Thailand etc, depending on whereyou are) for 7-14 days. After that, she could automatically re-enterAustralia for a further 6 months, and thereby get around 12 months at aatretch out in Oz, in effect.
2. However, if she prefers, at the end of the first six months shecould return to the UK and spend a while here. If she spent, say, 3months here, and then went back to Oz, she could certainly expect afurther 6 months in Oz at that point. Technically, I can see no reasonwhy she shouldn't reappear in Oz a day or two before her current 676visa expires and get another 6 months at that stage instead.
In the past, DIMA have told us that this would be do-able, though wehave never put it to the acid test with my own mother. We've alwaysopted instead for her to spend a little over 12 months outside the UK,as described in "1" above. When the second six months has expired, shehas returned to the UK and we have started the process afresh then. Ergo, although DIMA have said that option 2 is lawful, we have noexperience of trying it.
Cheers