1. IMO it was to show his whole unpleasantness: greaser hair, unbuttoned shirt, parallels with Nixon and constant snorting. Maybe he was a coke head too.
2. Do you remember that scene in 'Mulholland drive' which includes some enigmatic box, little people coming out of that box, a hobo, etc.? That scene never made much sense to me - it was plain weird and formally out of the context. And yet it somehow fitted perfectly in the whole story.
'Too Old' is inspired heavily by Lynch so pretty much the same could be seen here: something weird that nevertheless fits into the narration. It is what you say: Baldwin had some dirt on Martin and was showing it to him. And for some reason, Refn decided to show these blackmail materials not as something straightforward (photos, surveillance camera videos, etc.) but as a reenactment.
This I guess was my favorite scene №2 )
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