Schengen rules for Australian travelling Europe for 2 years?

That's fine as far as the maximum stay rule is concerned. As long as you haven't been in the Schengen area more than 90 days in any 180-day period, you can leave and enter as often as you wish. But nobody can guarantee you will be granted entry indefinitely. It comes down to the border guards' assessment of the plausibility of your story. And the more stamps you have in your passport, the harder they are going to question you.

For example, if you would come back to the same country repeatedly, it could suggest you are really working there and border guards could ask for details. The failure to explain your travels convincingly (“has no appropriate documentation justifying the purpose and conditions of stay”) would be the reason for any refusal of entry, not the length of stay or the number of entries per se.

Staying in one place is not really what you plan to do and, based on what little information you provided, I think you should be fine but I hope the example shows why it's difficult to answer categorically (see also Staying in Europe (Schengen and non-Schengen) for one year).

Note that “abide by law” also means not working remotely. So if your bank statements show you have significant savings, some sort of income from capital or perhaps support from your fiancé that's fine but a monthly wage (even from an Australian company) would not be.

Finally, Australian citizens have a few other options to stay longer in the Schengen area, including Work Holiday visas and bilateral agreements with several countries, see e.g. Visa for gap year in Europe

Your strategy is fine on paper. As long as your visits to Schengen are in compliance with the cooling-off period, you will be able to 'legally' present yourself at any Schengen entry port and request leave to enter.

The big caveat is that they are entitled to challenge you and can remove you if your case is not strong enough or they think you do not qualify. If, for example, the system indicates that you are building up a private life in Schengen pursuant to an Article 8 claim, you will be removed. These situations are largely determined by personal impact and articulation skills in addition to the documentation you present supporting your request. You mentioned bank statements and these are helpful along with other documents that show you have an on-going life in Australia.

During your travels you will be building up a record in various Schengen Information/Data Collection Systems, so expect the landing interview to become more engaging as time goes on.