1. Australia is much larger than England and Korea.

2. Australia is much larger than England or Korea.

3. Australia is much larger than both England and Korea.

(What is the meaning of #1? Does #1 mean #2 or #3?)

#1 means that if you added the area of both England and Korea together, Australia would be larger.\

#2 and 3 mean that Australia is larger than either one of them.