SPOILERS - Explaining the ending
Sweet country is a pretty good film. The cinematography, landscapes and acting are superb. The pacing of the plot is mostly well done and keeps it fairly interesting. But it's not perfect by any means. There are mini flashes forward in time plus a lot of jumping around between characters without much explanation. Which can make it hard to understand whats going on when you first begin watching. Some of these flashes work well but other times it can be a little confusing and you may find yourself spending too much thought on these distracting you from the film. The ending was decent though predictable and they attempt to leave it somewhat ambiguous.
Spoilers Below
The Gunman
Who was the sniper that murdered Sam in the carriage? If you pay attention to the events surrounding Sergeant Fletcher, you can easily connect the dots to him being Sam's killer. He was obsessed with avenging the deaths of his men and catching his "murderer". Yes, Sam saved his life in the desert but this obviously didn't matter that much to Fletcher. After he gave Sam the jug of water and stated he owed him it, he proceeded to beat him. The woman Fletcher wanted snubbed him after Sam turned himself in though the reason why she snubbed him wasn't very clear. He most likely blamed Sam for this as well. Fletcher was also the only character left actually shown to have a gun capable of firing that shot. Unless you believe it was Mick, who was never portrayed having murderous intent and appeared by all means law abiding and at the end even took to Philomac almost as a friend. Fred the pastor even stated he was riding with Fletcher to "make sure he is brought back alive", and that Fletcher wasn't "Right in the head". Fletcher showed the Judge little to no respect when he arrived and seemed to have the attitude there was no need to take the trial seriously because Sam was going to hang. His scene at the end of the trial, when he pulls his revolver and asks the crowd if they are going to question the Judge's ruling, is out of character from the rest of his portrayal. He was too calm and accepting of the Judge's ruling when compared to his fervor during his chase. For me it is obvious he is the final gunman. Thinking an Aborigine killed him is ridiculous for many reasons I won't get into now.
Philomac's Demise
The final scene show's Philomac looking at the watch he took from Harry's body, sitting on a log over a billabong. The last shot is from his perspective and shows the watch falling from his hands into the water. I think the significance of this shot is lost on most people. The way the scene occurs, his hands suddenly stop winding it then let go not like it simply slips from his grasp but more like he goes limp then a second or two later his hands jerk and go limp again, all this screams to me he was killed. He was checking out the watch and suddenly he just allows it to slip through his hands for no reason without a reaction? It doesn't look as though he accidentally or intentionally dropped the watch more like his hands just stop working. At this moment if you listen there is an odd flapping sound, maybe a bird, or maybe something being thrown at him. Though there isn't an impact sound but as a filmmaker if you wanted it to remain ambiguous you wouldn't want one. There also wasn't a gunshot sound when Sam was killed only an impact sound. Funny how it's the opposite of the Philomac scene, don't you think?
If I'm right who would the killer be? I only see 2 possibilities. Philomac's story was set up to show how the Aborigines were acclimating to the white people's way of life and losing their traditions and culture. This was even mentioned by the older Aborigine (not Archie) working for Mick. So to imply he was killed by an "untamed" Aboriginal while he was looking at the very watch he stole that made him "No better than the whites" would be poetic. Karma may play a role too since he lied about seeing Sam kill Harry and may have been able to put a stop to the whole chase if he had been honest. It also fits the tone and tragedy of the entire story perfectly and explains why we see no killer and hear no gunshot. Another less likely explanation is that Archie killed him. Remember the boy was being set up to replace Archie and he had even threatened to beat the boy several times after he realized this. Perhaps Archie killed him out of jealousy but I do not believe this is the case. It just seems out of touch with Archies character. No one else appears to have a rhyme or reason.
If you take the ending at face value then it was simple irony. His desire for the watch caused all this havoc and after obtaining it he loses it in the end. Except what's stopping him from jumping in and retrieving it? There's no reason for him to think the water will damage it and something that shiny and close to the shore would be easy for a kid like him to find. It doesn't really fit the movie's tone to be honest.