Extend the deck across the entire back of the house and then put a smaller staircase at the end to access the slope. :-)

That's a steep angle, it looks like you could use some erosion control. Low growing plants like ferns could work there. For the walkway I would use pavers.

Thanks for comment re extending deck. I think it might be too much long rectangle (house is too) and might need to break it up a bit. Also possibly too much expense. We could replace existing without new piers. I think expanding would require more piers.

That's true...would be pricey. But perhaps you could eliminate the retaining wall...saving some expense in rebuilding that.

You could incorporate some composite decking for a design feature to help break it up...or slighly lower terrace levels at a narrower width.