I am not an expert, but I think their visa would have expired, so they would have to start the whole process again and probably have to leave Thailand to get a new visa or visa exempt stamp. I think it's true they would not receive a fine, but everything else makes it a very bad idea.
non O is not a tourist visa. It is an immigrant visa. The 'O' stands for 'other', so it used for a few purposes, but it covers things like retirement and marriage. It is the best choice for you. Most people retiring to Thailand use this visa type.
to apply for the non O inside Thailand you need 800,000 in a Thai bank and it's virtually impossible to open an account on a tourist visa. The method you are suggesting used to be possible, but the banks have cracked down on this now, so it's virtually impossible. Much easier to get the non O before coming to Thailand.
You are applying for the wrong visa in your circumstances. Choose the non O (not OA) on the Thai Embassy website, then you do not need health insurance or criminal checks. Good luck.
okay, I was just checking you weren't applying for the non O retirement visa, because if your plan is to retire in Thailand, you need the non O visa before travelling, or you would not be able to open a bank account to extend your stay.