What is the current situation of the law regarding piracy?

I was intrigued by this comment in another thread:

Unless you're uploading, the best you'll get is a letter saying 'We know you pirated a movie please don't do it again'

Then I realised that I actually have no idea of the legalities of piracy, and I would imagine there is quite a lot of misinformation floating about.

• Is piracy a criminal offence?
• Are the huge fines publicised by media companies bullshit?
• Has anyone in Australia actually been convicted/sued/fined for piracy?
• Does seeding a torrent count as uploading?
• Do ISPs have to keep/give out records if requested?
• Can American companies do much regarding the piracy of their media in another country?
• Is there currently any legal risk in pirating at the moment?

EDIT: I'm only really talking about personal downloading, no commercial gain.