Hmm this is all based on the assumption of interest rates being 7%

You could hmmm you have 600k property with 390k of equity and no residual income… probably forking out 15k a year..
if you build the duplex it'll cost you 400k and you'll have a 1200k property…
then you'll have a 1200k property with 590k equity(1200k-210k-400k)… renting out at approx 550 each per week, you'd probably looking at a neutral to positive gear property… roughly speaking if you use the excess money solely to re-invest, you'd rent somewhere else at $550, you'd be $270 worse off each week… if you use the excess money to pay for part of your rent, you'd be 80 worse off each week…
if you rent somewhere else at around 280/w then you'd be in the same position but with more capital to work with…
really you've only increased your net self by approx 200k

Me persoanally what i would do…. if i was in your position… i'd do the following
1) look at what i want to have in 5-10-15-20 years….
2) look at what i have to work with….
3) take steps towards what i want to have in step 1….

for example… in the years to come if i wanted to have many properties funding themselves and funding me, i'd build the houses rent them out and rent somewhere cheap whilst i build/nuy my empire of houses
if however i wanted lots of cash in the bank right now i'd determine if me selling the duplexes after all the stress of building it would be significantly higher than just selling the house and land untouched with DA…
or… if i was simple and just wanted a new car… i'd see if i had enough cash to buy the car… then i wouldn't have to go through the stress of building a house and realising after it all i just wanted a car…..

i hope that helps….