They should be able to convert in Thailand if you enter as a tourist, but you need to ask Duke this question. There are other factors involved, so the answer will not be the same for everyone and every case.
exactly. This being his return trip after he spent 6 months in Thailand without a visa and then flew out for a day and back or something similar. There's a reason they don't include that stuff in their posts.
It's not that unusual. Embassies and immigration occasionally ask for proof of a fully paid reservation, flight or hotel, for various things. Just book a refundable ticket and be done.
Pretty obvious this person was already on thin ice to be asked for onward travel to begin with.
No. You need to show money in a Thai bank account in order to convert to a non-O visa, and you cannot open a bank account as a tourist. If you are going to Thailand in December, then apply for the non-O visa from the Thai embassy online before you travel. That may allow you to open the bank account on your trip.