Definitely not compulsory..many a child at DS1's school started prep without having ever spent time away from their parents or any paid care.
Our Kinder is really tough to get into as well. Our council goes by DOB and thankfully not first in first served. So I have been fortunate that the boys are August/September and got my first preferences.
I put down as many preferences as I could to work around the days I needed. Do you get to pick a particular group?
I work, so would just work around it. DS1 never went to kinder on a Wednesday as I worked and he went to creche, I advised the teacher's of this and they were fine. If something special was being done on the Wedenesday I would arrange to either have a day off or get a friend to pick him up from creche and take him.
It's a juggle, worth it for DS1 as he was a quiet kid and having the creche and kinder helped him socialise better.