The term is a shortened form of "chocolate frog", which rhymes with "wog" - a politically incorrect reference to someone of Mediterranean descent. An alternative Aussie rhyming slang equivalent is "freddo", which is a side reference to the chocolate candy called a Freddo Frog.
"Chocko" is also an archaic term referring to an Australian Reserve Army soldier, and is short for "Chocolate soldier".
It is often used in the masculine and neuter.