This really goes to show that 90% of the state security operation is about expanding state power, harassing minorities and setting up a social construction of "good" behavior, and not actually improving public safety.
Thus the word "stereotypical" and the sarcasm quotes around "Arab/Muslim terrorist." That's what people think a terrorist looks like. Of course an actual terrorist would try to blend in as much as possible.
Someone dressed as a stereotypical "American tourist" and started filming places (Sydney Harbour Bridge and a Nuclear research facility).
Then they had someone dress up as a stereotypical "Arab/Mulslim terrorist" and did the same thing to see what happened when he started filming.
Only footage of it I could find was this which is 240p - but is enough to get the idea of what it was about:
https://www.youtube.com/watch?v=w0n4Oehj6y8