Fraser Island was my favourite Island off the East Coast of Australia, but the Whitsundays and Great Keppel Island were class as well. On Fraser Island there's loads to see and it's also excellent for meeting other backpackers as you all travel round in 4WDs in groups of nine.
The Cook Islands are absolutely class and one of my favourite places in the world. Every night there was something special going on in town (e.g. cheap steak night, free 20 litres of vodka and orange, traditional dance show, etc) and the hostel I was staying at put buses on most nights for $3 dollars to take us right to where we wanted to go. The hostel also had a very friendly atmosphere and everyone got on really well with each other.
There was also a nice beach about a minute's walk from the hostel and another highlight was the cross-country hike which had spectacular scenery.