Smallville was axed. It just didn't rate. That wasn't the last episode, that was mislabelled by Channel Nine.
That episode, the last to air on Channel Nine had been: Season 2 - Episode 7 "Lineage" The final episode, however, for Season 2 is "Exodus" (Episode 23).
Channel Nine also cut out important dialogue and some scenes, I believe, shifting from Tuesday Nights to Saturday Evenings - which didn't prove popular, all the same.
I'm a *big* Smallville fan, and there's not much you can do about it now Monnie.
However, having said that, in the States, they had recently aired:
Season 3, Episode 7 "Magnetic"
I know that doesn't comfort you, but there's the Season 1 DVD Box-set being sold in Australia now, spanning 6 DVD's!