It may seem cruel but at the time it was the first time any offer had been made to bring the remains home at all - the option had not even been offered in previous wars. People wanted this option and so the government decided to offer it but at cost. No profit was being made - it was a very expensive process as it generally required a dedicated flight.
Part of the reason policy changed in 1966 was that the level of commitment to the war changed in that year and so Australia was now running regular troop convoys to and from Vietnam. This made repatriation of remains much cheaper (there was no longer a need to charter an aircraft specifically to do it).
I guess I need to remember that Australia was a relatively small country that lacked the resources and capabilities that we,or the Brits,had.Perhaps we could have helped our great allies,the Aussies,get this done.But LBJ wasn't a particularly warm (or fuzzy) kind of guy.Many Americans who remember him today think of him as being one of our worst recent Presidents.