Sydney Harbor is one of the prime venues for the new years eve celebration. There are plenty of restaurants, bars on this location where you can spend your quality time in Sydney. If you are looking for cruises check out http://www.newyearsevesydney.net.au, else if you are looking for a hotel then check out hotels like starwoodhotels ,harbourrocks , sydney shangri-la , hiltonsydney according to your budget.
But normally for the NYE, the prices go steep.
Even though crowded with over million people Sydney Harbour is one of the prime venues for watching the fireworks. To avoid the crowd you can on board cruises, or hotels. You cannot miss the fireworks, that is the major highlight almost 6 years ago