Even Brewer's doesn't come up with that one, Fred! I find it deeply unconvincing; indeed, I'd sooner go with what I imagine you were suggesting in your first answer...namely, that fair had to do with quantity rather than equality. I mean fair as in, "There was a fair crowd there this evening." The word crack - as well as suggesting a blow - also has the possible meaning of go or turn. In other words, the person being spoken of did get an opportunity to wield the whip but not for long enough in order that it might have had a positive effect.
The notion of unfairness to horses, particularly in the Australia of a century ago just doesn't cut it for me, I'm afraid!