Not sure if the fires were still on in Blue Mountains. When we visited, they were and I think if you had ventured more deeply into the area, it would have gotten dangerous real fast.
As of today, that bushfire is finally out, and they're expecting NSW to be completely fire-free by the end of the week! We've had a good deal of rain over the last week or so, and since Friday Sydney has been battered by what we call an east coast low (a low pressure system that's basically a cat-1 cyclone). https://www.abc.net.au/news/2020-02-10/sydney-weather-prompts-bom-and-ses-warnings/11948158
And yes - doing a serious bushwalk the days you were in town would've been borderline suicidal!