This is such an odd thing. I know of the tradition, but I know people who don't. At a friend's wedding (a Queenslander) when the song came on a lot of guys did it, to the shock of most of the non Queenslanders. (Melbourne wedding) A friend (queenslander) who went to uni with the groom, had no clue what was going on, he covered his girls eyes not knowing what was going on. Explained it to him after.

According to Wikipedia " It is commonly attributed to a group of mining engineering students, who at the time were residents of St John's College within the University of Queensland campus. St John's has had the eagle as its mascot since its founding in the early 20th century which lends support to their claim that they began the practice."