Staying/extending 90 days more if leaving inbetween Schengen expiry date of 90 days

Reusing an answer to a similar but not identical question:

Consider this thought experiment. Of course it is not practical to actually do this every morning, but I'm trying to explain the principle.

• Take a wall calendar with one square for each day. For today and the 179 preceding days, mark the day with a cross if you had been within Schengen and with a slash if you had been outside. If one hasn't been to Schengen lately, that's easy, just 180 slashes from today backwards. In your specific case, there would be about 70 crosses and 110 slashes.
• Each morning as you wake up, you mark the new day with a cross if you are within Schengen and with a slash if you are outside, and you erase the oldest symbol. (That means there are always 180 unerased symbols left.)
• Then you count only the crosses. If there are 90 of them, you must leave the Schengen area before midnight unless the oldest symbol is a cross (because then you will erase that old cross tomorrow morning when you add a new one and get 90 crosses again).
  After about 20 new mornings in Schengen (20 more crosses) you would reach the point when there are 90 crosses and they are all relatively recent. None of them will be erased soon. So the next morning in Schengen would bring the 91th cross and you would be over 90 out of 180.
• If you enter Schengen, turn the slash for that day into a cross. You may only enter if there were 89 or fewer crosses.
• Repeat each morning. That's the key thing. Every single day, the check is "no more than 90 days from the previous 180 in Schengen."

There are some exceptions to this which allow longer stays, notably for holders of a D long-stay visa, and also "grandfathered" bilateral treaties between Canada and individual Schengen nations. For instance, you can spend days beyond 90 in Denmark, but days in Denmark early in the trip do count against those 90 days as far as other Schengen countries are concerned.

I am a Canadian citizen. I will leave about 70 days into the Schengen visa given 90 days upon my arrival in Italy.

As a Canadian citizen you don't need a visa for short visits to the Schengen area, and you won't get one. You can enter visa-free, which means "without a visa".

I will go to Thailand for 12 days, and then return into England, with the wish for the chances of getting 90 days again (the stamp is for some reason in the middle of my otherwise blank passport you don't open to it directly.)

You don't "get 90 days". There's no concept of a 90-day period restarting. No matter when you enter and exit the area, the rule is always the same: You can be in the Schengen area for 90 days in a rolling 180-day period. Or in other words: At any given point in time you must be able to point to 90 dates within the last 180 days where you were not in the Schengen area.

With the plans you outline, this means that once you have been inside the area for 70 days contiguously, you have 20 days of allowed stay left. It will take you 90 days outside the area to accumulate enough out-of-Schengen days qualify for a subsequent stay of more then 20 days.

Can I get a renewal done if I get a letter from a non-profit community saying I am wanting to learn and volunteer more?

You may be able to get a long-stay visa from Italy if they think your purpose for going is one they want to support. You should talk to your host organization to hear if they're able to sponsor you for such a visa, based on local Italian law.

If I re-enter Europe into England, how will they know in Italy when I entered if I then take the train from England to either Italy or Portugal? I was thinking to do this instead of fly to get around the stamp into Schengen.

Note that England is not in the Schengen area.

If you take the train between England and the continent, you will go through the external Schengen border checks at the station where you board the train. During those checks you will get a dated entry stamp in your passport, just like if you enter the Schengen area through an airport (or land border crossing).