Australia is at about 3,5 persons per square kilometre and as you say one of the most sparsely populated countries on earth.

Compare to for example Denmark at 149 persons per square kilometre. Denmark needs about 35 TWh per year in electricity, so about 1,7% of their land area would need to to covered with panels to supply that.

(This is obviously napkin math and just a thought exercise)

If they were to convert their sheep pastures to dual-use like this (https://www.americangrassfed.org/solar-grazing-with-sheep-a-...) Denmark would be almost 40% solar powered without giving up any additional land area.

Denmark obviously has a lot of wind power and should not convert to a majority solar power for their grid, but I want to illustrate that the land area use may not necessarily be such a strong argument against significantly increasing solar power in more densely populated countries.