Yeah I've been on legitimate (ie, not agency obtained) "retirement" visa for ten years. Never needed the 800k lump sum. You just got to know how to work the hack!
It's to make life easier. I have a non-O "retirement" visa (It's actually a visa based on being over 50 years of age - there's no requirement to be retired), but I travel a lot. I'm probably in Thailand for 7-8 months of the year, the rest of the time I'm travelling. However, rather than live in Thailand on a succession of tourist visas, or free entry stamps (which annoys the crap out of immigration officers), I simply have the one visa (or actually extension) which does me for the year. I always extend about six weeks before expiry, so if there's any sudden need to leave, I'm covered to leave and return. It's great flexibility
I think you're guessing. I read that the new measures were to alleviate the pressures in immigration offices handling high numbers of extensions. So they're dropping the extension, and just giving 60 days flat