I’ve actually been through this as a Canadian who married (and have kids with) an American husband. Our first was born in Canada because it took so damn long to get my permanent resident visa so I could move there permanently. We had to take her to the US consulate and apply for her proof of birth abroad. Any child of a US citizen will automatically be a US citizen as well, as long as the US citizen parent lived in the US for a minimum of 5 consecutive years before turning either 18 or 21 (kinda confusing I know). So their baby would definitely still be a US citizen with dual if born in AUS. It might affect her status though, because although she can leave the US if she has either advanced parole or a green card, using the health care system in australia might be perceived as acting like a resident which puts your US resident status in jeopardy and therefore they’d have to pay privately to avoid that if she were to give birth there. Being an immigrant in the US gets verrrrrrry complicated.