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I'm trying to get some clarity on the rules surrounding the situations where a model release is required. I know that one is required to sell an image commercially where the person is recognisable, but I want to understand what is actually meant by "recognisable".

I checked what Alamy has to say and it is somewhat more rigid than I expected. In fact, it seems a little contradictory. First it says the person has to be identifiable but then it says one is required for a silhouette and even a body part.

Would a photograph of someone fishing, taken from behind so you couldn't see their face, require a model release? What about of a diver underwater wearing a mask and reg? What about a crowd of people at a sporting event?

My rule is that if it's a photo of a person and I want to sell it, it needs a release. Even if it's "couple in the distance walking into sunset" type. But if it's "a big fish" with someone's foot in the background I wouldn't normally bother. Unless they're right there and I can get them to sign easily.

That said, 90% of what I shoot is non-commercial so I relatively rarely need releases at all.

The NSW laws governing the use of 'unauthorised' photographs of other people are a little tacky with lots of murky, untested insinuations. But broadly speaking we can be pretty sure of the following....
1...You can photograph anyone you can see from or in a public place. Exceptions to this are, you cannot photograph any child who is a ward of the state, any person on the grounds of a court of law (until they step onto the footpath), or any persons engaged in an act for which it could be reasonably assumed they have a right to privacy (folk using the toilet or making love in their homes and assuming they cannot be seen).
2...There is no law that defines a right to privacy and therefore protects folk from having their picture taken apart from those mentioned above unless.....you constantly stalk the same person or go to unreasonable lengths to photograph them such as use a long ladder to gain access to their backyards etc.
3...You can use a photograph of a person as a work of art and exhibit and sell that image without their permission. There may be exceptions to this if the image is demeaning or damaging to the person then they have rights under common law to sue you and be compensated for any loss to their reputation and any financial loss that may incurr.
4...You cannot use any image of an identifiable person for commercial gain or purposes without their permission (a models release) apart from that mentioned in para 3 above. (Well, in fact you can....but they can also sue you for compensation. There are many folk who might be flattered and leave it at that. The more enlightend will probably try to gain a financial advantage from the fact)
5...The person must be clearly identifiable! The courts will probably examine the image in order to test if the likeness is such that the person could be identified by the average viewer of the image. It is not enough that the plaintiff knows that he is the subject of the image....will everyone else know? Hence, images shot from the rear, or where the face is obscured are probably quite OK to use commercially. In any legal action the plaintiff will have to prove that he or she is the subject in the image and can be identified by others as such.
6...Forget common sense...use uncommon sense...do not photograph anyone who clearly indicates they do not want to be photographed because....they may be criminals hiding from the police and they will bash you if you try. They may be paranoid schizophrenics and you don't want to antagonise them. They may be hiding from an ex-wife and child maintenance. They be have religious or cultural beliefs that a photograph will steal their souls. They may be operational CIA or ASIO agents and you will put yourself on their radar screens (frightening). ETC ETC ETC
7...And lastly, consider this...when the television stations do a story on perverts with cameras recording the images of topless sun bathers...they send a camera crew to the beach to film topless sunbathers for the program. Do they get a models release? No. Because they know they don't need it.
Use this information as a guide only. I have no legal training but have attended seminars and the above info seems to be accurate. There is a great deal of information on the WWW about the above...try the Arts Council of Australia for a start. And be aware that there are many areas of law that have not been tested. Exercise caution but don't become paranoid yourself.