Jeez, this is seriously dire, if North is going to be the spin option then why carry two spinners in the squad, McGain deserved his chance at this level, but this sort of treatment won't give him any confidence.
Anyways, out of the 12 man squad now, this is the XI that should play in the first test:
1.Hughes
2.Katich
3.Ponting
4.Hussey
5.Clarke
6.North
7.Haddin
8.Johnson
9.Siddle
10.Bollinger
11.Hilfenhaus
Don't think its worth picking McDonald ahead of a genuine bowler, and neither can both North and McDonald play in the same side atm, and at this stage, North is the more viable option, especially given the fact Aussies have decided to discard the spinners.
Though like it has been already said, my gut feel too tells me, that the Aussies are gonna play both North and McDonald and leave out Hilfenhuas, but McDonald batting at 8 is neither of much value with the bat, nor does he posses the ability to be a genuine 4th bowling option, at best he is just a steady 5th bowling option, so Aussie selectors are likely to mess it up, all over again.