It is a little higher so won't take it out entirely along the side of the house. If it looks like a problem I'll put a drain tile in and drain any water away.so your going to regrade and eliminate the crappy looking wood retaining wall?
Is the left garage higher than the right? Looks like it goes up a few feet... If so, I wouldn't pour the sloped piece in middle.
Yes the dirt will be taken out. Most of it will be used in other parts of the yard with landscaping projects.
The wood retaining wall will be replaced with cut limestone blocks stacked to match the slope from front to back.