For what it’s worth, those Sydney Cityrail machines were purchased secondhand from Canada, so they must’ve worked there too (unless that’s why the Canadians offloaded them). They’re fifteen or twenty year-old technology (and soon to bite the dust too).
I’ve seen the episode of Mythbusters where they experimented with magnetic fields to see how easy it was to damage the data on a credit card. Not very easy at all was the answer - you certainly couldn’t do it accidentally around the house.
In any case, the bar code on Euro notes is a series of large metallic strips running most of the width of the note, visible when you hold it to the light, so it can be read optically.
Thin papery plastic. They can still be folded and crumpled but are much more robust than paper notes.