Ok, I slightly misread your initial post cmac but still - England beat Australia last time. They've done so recently in Australia. England have the tools to really get at Australia and unsettle them. Those victories are still relevant, as they're proof that Australia would be wise to fear England.
And yes, England would be wise to respect Australia. But Australia lack the big ball carriers and grizzled defenders of, say, Ireland and South Africa, which are things that will really get to England. Those are the teams I fear (other than NZ, who are in a category by themselves in world rugby right now). Australia's backs can kill anyone on their day but England have the pack to really choke off Australia at base. It's not just about the scrum, its about the ruck and the speed at which Moody/Croft/Haskell will get in Cooper's face. It has been proven repeatedly that England can do that and beat Australia. I haven't seen what's changed since then, except for apparently Australia's form. Because getting beat by Samoa is great. Not fully representive I know, but then neither's beating South Africa B at home. Tigers' academy have done that for ****'s sake! While the fact England couldn't complete a grand slam is reason to write them off.
It's not a guranteed win. But until someone tells me how and why Australia are suddenly able to protect themselves from that sort of pressure, preferably with examples at international level (the form of a domestic club side is far from a gurantee, look at Leinster and Ireland ffs), I'm going to put England as favourites to beat Australia.