I don't see the problem either. If you are having problems with water collecting at the foot of the slope, then lower the soil at the foot of the slope, so it has a place to pool. If that is not enough, dig a french drain. This could be as simple as a burried pail with a rock on top so it does not show. A lot depends on how much water you are talking about.

Wow! I move rocks all the time in my garden and I know that even small ones can be extremely heavy. You make that rock look like it was made of foam lol. Spectacular garden. I love large rocks in the garden almost as much as the plants. =^)

Very nice wall. I'd consider planting the woolly thyme between the paver steps since you have it available, but any other low, creeping, full sun groundcover will work - any of the creeping thymes, blue star creeper (can get dieback in winter, so not exactly fully evergreen), leptinella or even Scotch or Irish moss. Both the leptinella and mosses will provide a dense and very cushiony surface on the pavers - great for bare feet :-) For the top of the wall, I'd consider something a little showier. Sunrose (Helianthemum cultivars) are evergreen, drape nicely and provide a long season of color, Lithodora if you like the intense blue (will also experience some winter dieback), heaths or heathers, dwarf hebes, even prostrate rosemary, although that looks best with a taller wall. Early spring in area nurseries will provide a wide array of blooming "rockery" plants from which to choose, but nearly all are very early season bloomers, so lack color later on. Sedums (stonecrops) and sempervivums (hens and chicks) are great to poke into niches along the face of the wall. Neither they or the groundcovers require any more soil to take hold than what's attached to the roots in their little pots.

You're in SA - first and foremost you need to look at what your annual max and min temperatures are, and especially wether or not you are prone to frosts at all. If you are, this will really change the types of cacti and succulents you can plant there, unless you can protect them somehow. Your garden, facing west, would receive more midday to afternoon light, which is harsher than morning light. Some types of succulents prefer semi-shade, or perhaps just morning to midday light, such as some types of Aloe from memory. Still, so long as you acclimatise your new plants to the light gradually they should be okay. Adding some gravel to the soil there would be a good idea. Is it a wet area? Or protected from most of your rain by the walls? The wetter it is, the more gravel and sand you will want for drainage. You could make the top couple of inches or so of the bed mostly pea gravel and sand perhaps, so that at least the bottom of the cacti bodies aren't sitting in wet soil during wetter periods. I wouldn't worry about too much more organic stuff in there, especially where you're going to put the cacti. Your "tall at the back, short at the front" plan sounds good, check out the link for some interesting photos of columnar cacti to give you an idea of what type of thing you like the look of, then once you have some names you can hunt them down. I think Trichocereus species are quite quick growing, and Cleistocactus strausii with silver hair are very striking and bright. Pilosocereus species are often very nice looking in my opinion too. You could underplant these with clumping cacti like Mammillaria or Rebutia species between the taller ones if you wanted to fit more in, or these could go into the lower bed. Or if you're after a blast of colour and contrasting forms you could have all the cacti at the back, and make the lower bed a succulents rockery, with different coloured species of Echeveria, Graptopetalum, Crassula etc. These all love a good dose of sun and will look fab when they're all flowering. They will clump quickly too, and all propagate at the drop of a hat (or leaf, actually!), so if you can't fill it up right away they will do it by themselves, so some gaps left are probably better. You say the beds are separated by a border of rocks, you could plant some Sempervivum between the rocks, these will spread too, and will look nice. They are nice, flat, tight rosettes, very neat, and there are miniature and different coloured species and varieties. The Dutch (or Danish, something like that) call them House Leeks and used to use them as roofing. Good luck, I'm sure some others will come up with more ideas and with more experience than I have to offer! Sounds like fun nonetheless. You may have some losses when you first establish a garen, don't lose heart, these are normal and then you will learn what works best in your conditions. I wish I could do the same, but I'm renting so will just have to garden vicariously...