You would get the retirement visa from the Thai embassy in Australia before going to Thailand.
Once you get to Thailand you will receive a 90-day entry stamp.
This gives you about 4 weeks to open a bank account and transfer 800,000 baht. The sooner you can do that the better (Maybe you already have a bank account though?)
As soon as your 800,000 in your bank account hits 2 months, and you have 30 or less days on your entry stamp, you can apply for the 1-year extension.
Once you have your 1-year extension, purchase a re-entry permit and you can leave Thailand until your next extension is due if you want.
The only "2 year" thing I know of is that it takes about 2 years to get a marriage visa. That's 2 years from the time you apply, until you finally get the visa. It's not something magical that happens at 2 years.
You can try applying for a tourist visa, but the embassy almost never grants those to married Thais because they think you are just trying to do an end-run around the 2-year marriage visa process. They think she will get to the US as a tourist and then you will apply for adjustment of status to get a green card for her.
You just use both passports until your DTV expires. They cannot put anything in your old passport as it's expired, but they need to see the passport number matches your visa.
You can go to immigration and see if they'll put a notation in your new passport that references your old passport number, so you don't have to carry both passports. Some immigration offices will do it while others will not.
A visa is a VISA. That is used for entering Thailand.
An extension is an extension, it does not have a visa type because it's NOT visa. The stamp in the passport says "extension of stay" because it's not a visa.
You can apply for an extension of a non-OA visa based on being over 50 (retirement). You can apply for an extension of a non-O visa based on being over 50 (retirement). Once you're on an extension you're not on any visa. You're on an extension based on a specific reason.
When you say a year, I assume you are talking about the 1-year extension, not the visa, as you are not clear. But with all extensions, you just need to purchase a re-entry permit before leaving, and be back before the extension expires so you can apply for the next extension. You could spend 1 day in Thailand per year applying for the extension if you wanted.
So do you feel the same way about all the Thais who apply for and pay for visas to other countries, walk into the interview, and are denied without barely a word and no reason given?