Sideways onthe bottom pit would be unlikely, 1 or even many m...

Sideways onthe bottom pit would be unlikely, 1 or even many m deeper might be feasible
but it lowers head.

Even the top pit would I expect to be easier to increase by making walls taller not removing and rebuilding them.
Existing walls leverage natural contours of the land to minimize costs.

TBMK either is unlikely to be cost-effective given 8hrs is pretty sweet for the duration. And making it more peak MW would mean larger or mroe turbines and no income while it was done.
Also, The water in the dams if drained would be problematic in terms of contamination from chemicals leachign out of mine walls.

Better to use one of the other 22000 candidate greenfield sites across Australia and make second one.