A lot of Aus Post staff don't have the best understanding of AP's T&Cs - which is a reflection on Aus Post and how they disseminate info. Or don't, more to the point. 

The small ones are document only, not exceeding 5mm thick and must be flexible.

The medium ones are designed to be large letters (so up to 20mm thick), but they also want them to be flexible, which is why they made them from flimsy paper I expect, and just have on the back: Do not use this envelope to send rigid items such as keys and USBs as sending these items may result in loss or damage, delays in delivery and / or missing tracking scans

The large ones do not have that disclaimer (or any other explicit item restriction) on them.