Can I use a military retirement pension to qualify for a Non-Immigrant O visa in Thailand?

sadly you could not use monthly income to get the initial 90 day Non-O or the first year extension after that at the immigration office.

You would have to use banked money method of 800K baht in a thai bank account in your name only

You COULD use that monthly income for the subsequent year extension the following year, by transferring in to the country a minimum of 65k baht a month, each month, every month for the next 12 months and using monthly income method next year