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My employer is going to be sponsoring me to transfer from Canada to Australia under a Subclass 457 visa and will be lodging it shortly. Before this even came to be, I was planning a trip to Australia in January and would be leaving for New Zealand in February. I had bought a one-way ticket to Sydney this past April, but still haven't purchased my ETA yet. My question is, can I still make this trip to AU under an ETA while my 457 is under review, or is that not permitted? Any help understanding this would be much appreciated.

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Yes, you can. However, it's usually not recommended, since an ETA is explicitly not a working visa and by lodging a 457 application you've stated that you want to work in Australia. You can (and people have) overcome this with clear evidence that this is just a tourist trip (clear vacation plans, wedding invitations, what have you), but expect some extra scrutiny. A one-way ticket is not going to be a great look for this.

The other potential issue is that if your 457 is issued while you're in Australia, your ETA will be cancelled, which is likely to cause some confusion on departure. Again, nothing unsolvable, but expect some extra hassle.

All in all, I'd suggest waiting until the 457 is issued before you come over, and that way you're (almost) guaranteed to have no problems.

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