I was very sad to find out that Eurovision is very mocked by Australia and is seen as trash tv. Their opinion there is the same as it was in the UK a few years ago.
It very much depends on the individual - there are plenty of people who watch it to mock it and plenty who enjoy the music. I moved from one to the other - I started watching in 2007 for the laughs after seeing Dancing Lasha Tumbai, but by 2009/2010 I'd grown to really love the event as a whole. Also, comparing our commentators with the UK, ours actually seem to take it more seriously - I've watched both commentary versions for most years since 2007, and while Graham Norton doesn't ridicule it as much as Terry Wogan did, it still seems clear to me that the Aussie hosts (Julia Zemiro and Sam Pang) give the acts more respect while still being entertaining.
As for those who don't watch it - I find that the average non-watcher hasn't heard of it, so there isn't a particularly negative opinion. I've been laughed at twice for being a Eurovision fan, but both of those two people had only lived in Australia for a couple of years (one having immigrated from Singapore, the other from France). The rest of the media pretty much ignored it up until recently - largely since they didn't want to mention another station's show and hand away their viewers, I think - but it's been getting increased attention in the last couple of years. I first noticed a couple of brief mentions of the Eurovision winner in the news from around 2010 onwards. From then, in late 2012 Euphoria was used as part of the soundtrack for a popular reality TV show, there were more stories about it in the prime time news in 2013, and it got a whole bunch of coverage in 2014 (partially due to Jessica Mauboy's interval act and partially Conchita's win, both of which were handled well, all things considered).
Only difference is they actually love watching it, and get up at some god awful hour to watch it.
Only a small minority of the hardcore fans do that, I think. While the event happens at around 5AM to 8AM in local time here, it's broadcast with Australian commentary at something like 7:30PM on SBS (a national public broadcaster specialising in foreign programs), and most people watch it on that. Crappy internet speeds are another thing that put some Aussies off watching it live. Even though I'm pretty devoted to Eurovision, I wait for the evening broadcast myself - I'd rather experience it in HD on a big TV than watch a laggy stream on my old computer monitor, and since it's become a tradition to watch it together with my family (who aren't as much into it as I am), I just try to be patient for 12 hours or so. The main problem is that I have to force a media blackout on myself - since the media nowadays is almost certain to suddenly announce the winner, and all of my social media feeds/internet tabs are plastered with Eurovision news, I just cut my net and try to pass the day as a hermit. This year was particularly bad, as we had a big meetup with the grandparents' for Mother's Day (which was the day of the Eurovision final) and I had to make my way through a shopping centre with news playing as well as the grandparents' radio... somehow I survived spoiler-free.