There is nothing wrong with them except they’re about 2 inches lower than the prescribed height.
Well, that’s what’s wrong with them. But a rail or some security glass along the top would fix that. You don’t have to replace the entire balustrades if they’re otherwise sound.
would a strata be fined for NOT upgrading the balconies?
If the council ordered your scheme to replace the balustrades or make them safe, you could be fined for ignoring the order. But the order would have to come first – you can’t be fined pre-emptively