Well, you might get cheaper airfare from California....I don't estimate airfare to be any different when comparing CA with HI. HI gets kinda hosed on stuff like this.
You are right about the short hop to PNG being the majority of the cost. The domestic airfare alone in PNG is a little over 300.....airfare to Australia about 1200....possibly less from the US mainland - but that tiny few hour jaunt to PNG really gets ya. And yes, the hotels along the way jack up the price. BUT - though this is a flimsy argument - I actually enjoy the overnighters along the way.
The cost is the reason I had to plan the trip so far in advance last time (with a 10 month wait) and this time (with an 8 month wait).
I really do want to hit Indonesia and Fiji - and I will for sure. I might even be in Indonesia in September as I have business in the far east.....I might make Indo my last stop and sneak in a few days at Wakatobi or Lembeh Resort....that'd be AWESOME....BUT, I can't really lug my dive gear along on the whole trip so it probably can't happen....WHICH KILLS ME!
As usual I'm already thinking about where I'll go next after PNG. Weird right? I don't leave for 8 months and I'm already planning ahead! But I'm thinking I might get myself over to Cocos Island late next year, or perhaps Fiji. If it waits til summer of 2014 I'll start tackling the Caribbean......but that's all way too far off to judge.
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Honestly Shasta Man - if you or any of your dive buddies are curious....I'd recommend the following:
For US based divers - European and Asian divers I'm sorry, but you're on your own.

If flying from the West Coast: Price flights through whatever venue you think will provide you with the best deal. THEN, try your luck with the price you "think" you can get with priceline.com. THEN, if you don't get the good deal you were trying for - lower your expectations a bit and work with Liveaboard Vacations (Debbie Messina and her staff) and see if they can find you a better option.
In addition to the above for you east coast and mid-west divers.....
If flying from the mid-west of east coast: IF you can't get reasonable flights to Australia from the east coast direct on the same ticket - then try combining itineraries. Meaning - try getting a ticket to the west coast with a stop in San Francisco/Los Angeles/Seattle/etc. for a night or two. Look for something you've always wanted to do over there like wine tasting, maybe squeeze a little diving in the Channel Islands (that's what I'd look into), etc. THEN try and get airfare on a second itinerary to Australia or some city in the far east that has flights to Port Moresby. Plan an overnighter to give you a bit of a pad in case there are delays and BUY TRAVEL INSURANCE REGARDLESS OF YOUR ITINERARY! THEN as a third itinerary, get airfare from Australia (or some city in the far east that flies to Port Moresby) and try and get the rest of your itinerary on that ticket all the way to Alotau (the Star Dancer boards at Driftwood Resort - apparently a 15 minute drive from the Gurney Airport in Alotau airport).
From wherever else you're coming from regardless:
If all else fails and you're honestly serious about experiencing Papua New Guinea and diving Milne Bay and experiencing what is without a doubt the best frontier diving you'll ever imagine....call Liveaboard Vacations at 1-800-9DANCER and ask for the travel department.
PNG is not a destination that you're likely to find cheap airfare to - and if you do, you should be given a "scubaboard.com/forums/liveaboards award" for finding airfare to PNG from the US for under $2K. But my faith is that if you like small critters, interacting with villagers, variety of diving (both diving on walls, pinnacles and then black-sand/muck dives in the evening) and also love the opportunity to see sharks and mantas as a close second priority - then come see what's up in Milne Bay. You may find that the dive destination you thought would be a "one hit" destination might beckon you back for future visits sooner than you think.
NFLOR! I know who you are dive buddy who was with me on 20+ DIVES IN PALAU on the Tropic Dancer trip!!!! Get your butt on a plane pal! Come experience the magic of Milne Bay - I could use a roommate that I already know! I promise I won't lock you outta your room

LOL!
Let me know if there are any other questions. I'm fairly certain that in the next 5-6 months we'll probably get enough people onboard that are booked for this trip that the boat will sail. HOWEVER, it would be neat to have some online aquaintences that I can share thoughts and plans with as I get ready for this trip in the early months of next year.