Angus, there are two broad options if you want to just ride from Sydney to Kangaroo Valley - either head down the coast and then climb a BIG hill to get down into Kangaroo Valley, or head inland to the Southern Highlands (gradual climb and then down into the Valley).
The coast route has a fantastic ride that roadies use for training on weekends from the centre of Sydney through the Royal National Park and down a cliff-hugging coast road to Wollongong (90km) - or you can miss the less pleasant start of this and take the train as far as the national park. Day 2 would be from Wollongong to Shoalhaven Heads (65km) or further south to Jervis Bay (100km). Spend a day around JB snorkelling with Dolphins, windsufing, swimming etc. From JB head back up to Berry and on to Kangaroo Valley in a day (about 100km). You can't really loop this as there are no roads inland due to mountains in the way. See the Lonely Planet Guide to Cycling Australia for more details.
If taking the highlands option, you don't want to ride from the centre of Sydney - roads and motorists are not cycle-friendly and no real bikepaths to take you to the outskirts of the city and it's just ugly. Take the train out to Liverpool. From there take the Old Hume Highway to Mittagong and Moss Vale over the course of a few short days (go winetasting along the way). From Moss Vale to Kangaroo Valley you can mountain bike (with panniers) down Meryla Pass and through the Moreton National Park in a day.
cheers
David
