I am feeling this dilemma too.

THis will be my 3rd baby.

Private:
THe first was private with appointments with Dr Bella in Eleanor St Footscray (you mentioned the western suburbs so thought I'd pop that in). Then a delivery at The Mercy (East Melb now in Heidelberg) where I ended up needing an emergency c-section. I don't beleive my health insurance status had anything to do with it, the baby was posterior and it was a 13 hour labour. He just wasn't coming out.
My prenatal care was very good, in hind sight I would say this ob was much more thorough and gave me every test imaginable just so she was ready and could rule out everything. For instance the test where they check you for Strep B. Later in my 2nd pregnancy I would find out that the public system doesn't always request a check for strep B. I came up positive for for it so was very happy they found out before baby was exposed.
Financially I was up for a capped $800 in dr.s appointments, plus all my scans and blood tests, plus co-payments on my hospital stay, plus the anasteasiologists (i haven't even tried to spell it right sorry) fees. Probably close to $2000.

Public:
The second was public system with appointments at The Mercy and a natural birth at The Mercy. This was a wonderful experience and I was lucky to have been given a double bed in a private room just because they had iy spare. The pre natal care was all by the book. I fortunately had a very 'boring' pregnancy. I felt like an old hand by then and was just attending appointments as a matter of obligation. The scans were the most exciting part for me. Financially I just paid for my ultra sounds and blood tests. Depending on where I went for the u/s this pregnancy would probably have cost us about $700 tops.

This 3rd one -my due date is about 18 June - confirming with and u/s in a week or so.
Dr Bella's assistant wasn't sure if she could take me on since my due date is still under question and the dr is away for May 2008. Rather than risk her office saying no, I have booked in with an Ob who delivers at St Francis Perry House.

Co-care? :
However I am in two minds about it. A friend mention co-care or something like that where you attend appointments as a public patient. I was very happy with my pre-natal care the second time around, publicly. I didn't see the same person at each visit but they were all well versed on my history and they don't really do all that much but answer your questions, measure you, weight you, check your urine/blood send you off for standard u/s etc. It's all very scripted and standard. But then because you're privately covered you can still book in for a private delivery. I am really not sure how on earth this works and plan to attend my first appointment privately and broach the topic with the ob.

Hope this helps and doesn't confuse you even more.

I understand this is your first pregnancy. With my first I was very nervous and wanted only the very best - (lol I even bought a bugaboo which a couple of years later I regretted but they were the BEST at the time...) This time around it's about making the pregnancy as easy and stress free, and as easy on the bank balance as possible. But still ultimately, I'm undecided.