Your pics didn't post, could you try again please?

What's the water situation in your yard? Kind of hard to tell in the pic, but it appears a bit fisheye. It looks like it is a bowl, on the corner- and I can't tell if there is sewer there. It could be possible that wall is helping with water movement as well as retaining earth.

Downhill driveway to the right that goes to shed. Neighbors to both sides do not have retaining walls though they have similar slope

Downhill driveway to the right that goes to shed. Neighbors to both sides do not have retaining walls though they have similar slope

Ok, not a corner, the driveway. Good to know. How much of a vertical difference is there between your yard, and the level on the other side of the wall? Where the steps are, that is probably the high spot. Would you want to leave the steps, or put in new ones, or grade the slope for a walkway?

2.5-3 feet vertical difference. Iwould put in New steps. Honestly, I don't want to remove the retaining wall. But to put in New one costs like 6k--for a wall nobody will see but from inside.

You'll probably have to redo the walk a bit. Aside from that, it doesn't look like a necessary retaining wall. In general, a 45 deg slope is stable, and that wouldn't be a problem here.

It doesn't look like it's in that bad condition to me. I'd consider planting shrubs in front of it to hide the problems and letting it decay naturally.

It sounds like you don't want to shell out 6G for a new wall, reasonable enough. But keep in mind that removing the wall and addressing grading issues and reset is also going to be costly. Less costly than the wall replacement? I don't know.

If you don't actually want to remove the wall... is it possible to renovate it for less than a new wall or reset? Patch up and fill the holes with cement. Maybe do a fresh smear coating on the whole thing in a color that appeals to you.

Anyone know what I can do with that hole in the retaining wall

As said above the least expensive route would be to keep the wall and disguise it.

Get some bricks, rocks, etc, and a bag of cement and fill the hole. Fill any other deep gouges. Once the wall surface is reasonably flush , stucco the entire wall.

I like the suggestion of making the wall the back ground for a garden feature. Plant some flowering ground cover behind the wall, and then plant some roses, gardenias, etc that would drape over the wall, Plant some low bushes along the base of the wall. You may wish to plant some bushes near the steps and at both ends of the wall especial at the driveway end.

You should be able to fill the hole and the stucco by yourself. I would plan the garden, but install slowly so you can see how the plants, the wall, and the driveway are looking. This way you can vary your plan to get the best effect.

Remember these plants have their own clocks, so it may take time to get it looking the way you want.

All this advice is assuming the retaining wall was engineered properly to begin with. It may have been a DIY and if it's failing that could be it.

You really need a pro on site to determine proper grading for drainage. Photos don't work because the lens of the camera distorts the plane of view.

If it is determined that the wall is okay, I would YouTube how to patch vertical concrete and then stucco over it with a trowel or spray texture the whole thing DIY.

You can repair the hole, you don't have to replace the entire wall for that. It just depends on what your goals are.

Also, any grading issues are independent of keeping this wall or removing it. Proper grading would look the same in either case.

It looks like the wall was installed to control flooding. Do you get runoff from the neighbor to the right? Do you ever get standing water near the house? You could control neighbor's runoff with a berm (or another brick wall), but he's likely going to drive on it at some point.