A non-aboriginal business has licensed the copyright on Australia's aboriginal flag, and are making copyright claims against aboriginal businesses

A sticky wicket indeed, but given the details, the artist was well within his rights to sell license, and the company is within its rights to defend the terms of that sale.

Sounds like the perfect opportunity to hold a contest for a different design, by an aboriginal artist and judged by that community, with the terms of the contest requiring the agreement that the result would have some variety of CC license. Solicit donations for prize $$ so the artist would get a good reward.

That’s what I would do, if I were part of that community, but I’m not. I do hope they work something out though.