Would the Reds be seriously entertaining signing him? Obviously teams can't afford to pass up Wallaby talent but I'd say with the form that the Reds backs are showing, with a Salary Cap coming into effect next season paying big money for a player, who would be replacing an established and currently performing player, rather than filling a void wouldn't necessarily be the best move on their part.
Let's face it, the Reds have Hynes and Davies yet to come back, Chambers was playing well enough last season to make the Wallaby squad if it wasn't for injury, Morahan is on the rise, Harris is showing some form and Fainga'a is critical to their defense. I think the addition of O'Conner's exceptional individual talent could upset the team dynamic and possibly shift a player whose impact you don't really notice until he isn't there (e.g. Ant Fainga'a).
Excellent player, but not worth the Reds breaking the bank for. The other franchises on the other hand all have gaping holes to fill that would justify outlaying the money to bring O'Conner into the fold.