It seems that you’re right, the 7pm NSW news is still in blurry SD. In a way I’m not entirely disappointed, because I do really want to be there when (very long awaited) history is made and Sydney becomes a market where all local TV news bulletins are produced/aired in HD! 
Hopefully there are plans to upgrade that control room soon because as we’ve seen in the ABC News Channel thread, the current NSW set really shines in HD (although it’d look even better if the lighting was improved…) but looks so-so in SD.
I’d imagine that is almost a certainty, if Victoria also adopts the “deskless” presentation style that the 7pm NSW & Late Edition bulletins have.