Well after a trip to Kmart and several sms's between Kelly and myself, we worked out what the item is... it's called a SAFE AND SECURE BABY SLEEPER BY THE FIRST YEARS.

You can google or look on ebay and you will find them. The price at Kmart Burwood East was $70 and on ebay they are starting at $45...

I think I better check with DH to see what he thinks - we haven't had that conversation yet, but I like the look of them!

Thanks Kelly for letting me disturb your day, and thank you for all your patience and assistance.

Edited to add... One just went for $68 on ebay.