Glenworth Valley! I love it, althought I live about 4 hours away from it, we always go there. Its a great place.
The mid north coast of NSW is also a pretty nice horse area. Not sure what style you ride, but english is the predominant style. Its not exactly a place full of studs, but its right near the beach, and a lot of comps happen.
And I love Sydney, but for me I personally don't like living there. I lived there for four years and I hated it. Too much hustle and bustle. I do the Sydney dressage circuit with my friend as her groom, but I just can't stand city living.
I honestly can't recommend the Mid North Coast enough. Its right in the middle of the coast, and its really quite a pretty place. I live just south of Port Macquarie, and its great!