Where's the picture(s) that shows the overall condition so we can see it? Show how house relates to rest of yard.

I often thought people regrade and push the slope further away from the house be better landscape,easier to finish the project and to deal with the drainage problem than put in a wall.
But nice landscape is a visual feeling.I prefer to add some ideas on some photos.my intention is to avoid the result is very different from your image and wordy suggests,help you easy read and visual understand a couple of examples of how to tie it all together and great planting combinations and contrast and shrubs nice mix and coordinate colors.
You really need to post some pics that show the context and situated and conditions and the perimeter line of the property(They are not too close up).
first upload photo to any photo-hosting site.Photobucket and Flickr are examples . While at that photo on the site,
look for a link to "share." Then look for a way of obtaining "html code" (don't select the thumbnail version.)
Copy that code and paste it directly into your message here.
If need plant suggest,You should tell me that sun light time(or where face?),climate and soil PH.zone,or local name.

Well, what is really the downside? Some dirt migrating can be dealt with with a rake once a year if it really is happening, but 100 years with not too much migration, even with kids sliding on it, sounds fairly stable. That stability, however, probably depended in part on a healthy covering of grass, so getting that going is indeed going to be key.

If there have been major changes at the top of the hill - say, a new house built with a big driveway surface draining your way - I'd be concerned. I'd also think long and hard about whether water coming down the hill might have had anything to do with your foundation sinking. Otherwise, why not put the slope where you want it?

From a yard usability perspective, I might also think through whether it would be better to have a usable upper and lower section, or a single bigger area - wall or no wall.

Karin L

If it hasn't been a problem yet, I wouldn't worry about it.

My walkout basement should be in major trouble by that metric....