Advice from an engineer is required.

On account of their expense, people do not usually add retaining walls unless they're essential for holding back earth. It's not likely you could remodel it without substantial expense. Enough money can cure anything. The stairs might be a little easier to deal with but that would depend on what they're doing outside, and the architectural features of the home.

Any time you have signficant earth movement - and removing a retaining wall with that sort of height will definitely require substantial removal or regrading - you are looking at a major expense. You should certainly get a professional involved with this to see a) if it is even feasible; b) how much it will impact grading of the rest of the property and yours and neighboring storm water flow and c) what an approximate cost mght be. But be prepared for a significantly large price tag!!

Start by seeing if you can find out why this was done. My guess is it is a combination of both basement egress requirements and drainage issues. Once you know why it was done this way, you will have a better understanding of the requirements and options associated with changing it.