Holmes was not familiar with Sussex. One of their last cases together, Watson had to teach him about the region, because he had lived there at one point.
In The Problem of Thor Bridge, Holmes and Watson are now living in a house, which has a tree in the backyard, with a cook and a pageboy. This is also one of their last cases.
Watson refers to it as the car, rather than his. I’ve put this forth to many different people, all of whom agree that if something is owned by a single person they would say My Car. If it is owned between two people, they would say The Car.As far as I’m concerned, because of these, and other factors, Holmes and Watson retiring to Sussex together is canon.
As for how they spent that retirement…
Holmes tends his bees, makes honey, and goes to the beach every day the weather is fair. On rainy days, he spends his time cross indexing his files. Eats chocolate. Complains about his arthritis. Irritates his companion just to get a rise out of him.
Watson gardens. Originally this was Holmes’ hobby, but Watson discovered he had been growing belladonna and monkshood, and promptly put an end to that. He refuses to swim. He claims that he has earned his old age, and won’t go about swimming to try to stay trim. He does, however, go up to the stables at the school to ride once a week or so. When Holmes mentions it, he feigns deafness. He also goes shooting as often as he can, because even though cases are few and far between, he still wants to be ready to protect Holmes.
James Dodd and Godfrey Emworth visit them often for tea. Dodd and Watson fawn over cars together while Holmes and Godfrey roll their eyes.
They go for long, rambling strolls together, just like old times. Holmes’ hand tucked into the crook of Watson’s elbow, using his stick to point out interesting plants, and cloud formations. They are recognised in the village as always having sweets or coins in their pockets to give to children.
Watson is still incredibly fast to jump between Holmes and danger. Holmes still has to calm him down and ply him with beer and biscuits to get him to stop getting in pub brawls. The words “We’re getting too old for this.” is muttered several times a month.
They visit France once a year. Watson meets Francois, and much to his irritation, adores him.They live happily for many years together. Watson passes away first. In the garden, of a heart attack. Holmes follows shortly after the funeral, quietly in their bedroom.
This was so sweet until I got to the FUCKING ENDING GODS DAMMIT.