There are several issues involved with adopting a child from overseas and bringing him or her back into Australia to live. Firstly the adoption will generally be completed in accordance with the laws of the child's country. Australia considers this a 'private adoption' and strongly recommends against pursuing them, unless you involve your resident state or territory in the adoption process.
Your sister and her husband would therefore need to adopt a child in accordance with Mexican law. However, in order to bring the child back into Australia they will need to obtain an adoption visa for the child. This is the tricky part. If you are unable to obtain an adoption visa, you are unable to bring your child into Australia.
It appears that an adoption visa may be granted in the case of an 'expatriate adoption', which is where that the adopting parents reside in the country that the child comes from for 12 months prior to the adoption visa application. I don't know whether this is a possibility for your relatives.
In any event, it is not something to be rushed into and I would strongly recommend conferring with Australian authorities prior to proceeding with any overseas adoption. See the following website which has a fact sheet on it for some more info:
http://www.immi.gov.au/media/fact-sheets/36adopting.htm
