I entered Thailand back in October at Suruvahumi Airport and received a 90 day permitted to stay stamp in my passbook. Unfortunately I was too exhausted from the flight and unexpected delays to see that the immigration officer had failed to initial or sign the last line of the stamp that says signed. Now I will be going to Chiang Mai immigration in the not-to-distant future to apply for an extension of stay based on retirement and I am a little concerned that I might be told "sorry can't process your application, you need to go to Bangkok to get your entry stamp signed first." Is this a valid concern or is this something that other immigration offices see a lot and understand some immigration officers don't dot every i and cross every t and it shouldn't be an issue?

It will not be a problem. They see wrong days, months and years on stamps. I am sure some missing signatures also.