You really shouldn't be viewing the university itself as something for employment advantages. And I don't believe UTS's teaching practices are poor; in fact, I've never been told of this at all. It seemed pretty hands-on at first glance.
(On the other hand, for example travel time may influence one decision over the other.)
Sure, UNSW's engineering is world-class level. And I did actually have a friend who gave up the scholarship in favour of UNSW. So I don't think your train of thought is completely unjustified. Perhaps, if you're heavily set on working outside of Australia, the added name-value of a Go8 university is useful.
But otherwise, universities are not something that affect employment prospects greatly at all. If anything, I'd wager the only time it would matter is if there's a difficult-to-break tie in candidates left, and their university was the last thing they had to distinguish them.
I don't think UNSW's engineering teaching is perfect per se either. For the most part I am hugely in favour of it, but some bad apples in the engineering faculty hurt a lot.
So whilst picking UNSW over UTS is perhaps somewhat safer, you really should check if it's worth. You should also consider if giving up the scholarship is something you're not gonna regret deeply down the road. Scholarships can save your financial situation a lot, if they pay out a lot. (I had to make sure my friend was certain of that, before they picked the UNSW option.)