All the above answers are good, but I'll just put in my two cents.
Physics is probably better in your case. I say this because it is easier, it scales pretty nicely, a lot of people find it more fun than Specialist, and finally because, though you will need both in most types of engineering, Physics is probably the one that is harder to pick up later. I would say that the maths you will do in Uni would tend to build more off Physics than the other way round, and therefore it would probably be a better VCE option.
Sorry but I’ve got to disagree with you there.
1) It’s a well known fact that Physics in uni is very different from what is covered in high school (which contains a lot of formula plugging in and cheat sheet reliance.
2) Most people find high school Physics very dry compared to Specialist, if they have the mathematical ability to do well in Spesh.
3) University maths which you will be doing in Engineering will extend upon Spesh. Physics on the other hand is not a prerequisite for Uni Physics.
4) Physics scaling is nothing compared to Spesh scaling and I don’t know how this is relevant?
5) Physics in uni is a lot more mathematical and objectively, uni physics builds more on spesh than uni maths builds on vce physics. I’ve done the hardest possible 1st year maths subjects available at UniMelb, and physics knowledge is not needed at all. Unless the newest study design somehow drastically changed the vce physics course which I doubt.
Have you learnt content in uni maths? Since you are in vce I am doubtful you know too much about how these subjects connect with uni subjects.
IMO doing both physics a
nd spec is good. Spec over physics for sure, if you’re set on Engineering. Engineering is a rigorous course with extremely high drop out rates at some
unis. Spesh will prepare a lot better.