The stale piss smell is definitely from sheep transport ships that come into Freo. It's been going on for over 20 years. It has nothing to do with the dredging.
With a good westerly blowing you can smell them before you see them. Pretty amazing really. But the good news is, you will never get sneaked up on by a sheep ship.
Years ago I was sitting up on the dune watching the guys sailing.
I thought I must be sitting where some dog had peed because all I could smell was pith.

I moved about 5 metres North,. Same thing.

Another 5 metres. Same again.

Man! Some dog must have hosed down the whole beach

About 15 minutes later a sheep ship came cruising into view and once it had past, the smell disappeared, until the wind swung SSW.

Once they get into port, if a good southerly is blowing, the smell blows right up the coast to Cottesloe & further.
You get used to it and after a while you dont even smell it.
No worse than the rotting seaweed at some times of the year which can last for a month or two.