Okay. In a cycled tank, the amount of water changes you were doing would be perfect. But because this was a new setup with 5 fish in it, I think the problem is the ammonia spiked and made Walter sick. It may not have affected your mollies because they are quite hardy fish and also, Walter's age may have played a part in things too.
I'm going to PM you a quick guide on cycling with fish in the tank. Cycling is a seriously confusing thing so I hope the guide helps you understand how it can help you and your fishies. For now, don't add any more fish to the 10g. That would cause another ammonia spike that could kill even your hardy mollies.
If you decide to get another betta, and I hope you do, keep him in the 2.5g until your 10g cycles. In the 2.5g, you'll want to do twice weekly water changes if you can. Usually it's 1 50% and 1 100% a week. If you can only do 1 water change a week, do 100%.
If you have any more questions, definitely post back. Everyone here would love to help you out. Again, I'm really sorry for your loss. Walter had a good long life with you.