I have to laugh, because we had one of those pools in our backyard when we bought our house. It had a huge deck built up all around it. But at 4 feet off the ground, it didn't even have a railing on it! At least your deck won't be so elevated. We tore it all out.

I think you should have a plan for drainage around the pool, because if it is just dirt underneath it will continue to settle. Although I am not sure what kind of soil you have there, but maybe at least something between the pool and retaining wall. Good luck!

I'd be most concerned with what happens in the surrounding pit between the wall and the pool: yard debris, leaves, dropped hot dogs, water without drainage. How will it be cleaned and drained?

Have you priced out simply doing an in-ground lined pool? Seems like less work.