I'm very sorry this has happened to you!
You are nearly 1000 km's away from the stud - how is your friend going to visually be able to see this is your mare??
You need to be very careful not to alert him to your suspicions or they will move the horse and you will struggle to ever find her.
Get your parents involved, these people will be pretty slippery and may trip your friend up.
Contact the police. Go into your local police station and talk to them. Your going to have the problem of NSW v's QLD, so it might get tricky. But they will be able to advise you what to do. Ask them to contact the appropriate police in Sydney and advise them what has happened.
Do you still have her stud book papers? or proof of purchase? Photo's etc. Take it ALL into the police station with you.
At the very least the police can attend and ask for proof of the mare having died. Don't just take their word for it ;-)
If he was a big name stallion he would have been on a big stud with a big service fee $ to match it. A big name stud that has a manager would have contacted the stud book and notified of her death.
Contact the stud book and ask if they have had any such notification from the stud of her death. Make sure you have all her details at hand.
One tiny small good thing about this is, that they cant use her for race breeding purposes if you have contacted the stud book and told them what you "think" has happened. But obviously they could use her for pleasure breeding, riding or selling ;-(
I think it is VERY plausible that she is still alive. How did your friend come to hear of the ad for sale??
It is definitely possible that she died from snake bite. On the TB stud we ran we lost many mares to snake bite, it is a very unfortunate part of the country we live in ;-(
However, a reputable stud would always get a vet out to give a written conformation of the mares death to the owner. Noting her brands and markings.
We had horses at our stud from all over Australia. Owners have to be able to trust where they are sending loved and often very valuable mares.
Please get the police ASAP - it will be your very best chance of finding your horse. One small slip and they can move her or even take her to a meat auction to get "rid" of the evidence. They would face prosecution if caught by the police so they will do what ever it takes not to get caught.
Good luck in your search ;-)