1- Yes, she's from Issan. They're also considered the "rednecks" of Thailand. My wife qualifies

Mostly rice farmers and a huge source of those who work as ex-pats. They work hard and they party hard.
2- Yup, Lao (aka Laotion) Whiskey. The Issan region borders Lao, a communist and very poor country. How poor you ask? So poor that booze smuggled in over the border into Thailand is still cheaper than Thai booze.

Folks from Issan will also use the term to describe their moonshine. It's very smooth

If you can handle Lao Whiskey without becoming an ass, vomiting, or dying from a hangover they're mentally putting you in the category of someone not to be messed with.

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If you have the chance to go back, spend more time in the village and don't be shy about sponsoring parties and cook outs. You'll have a blast, learn lots more about the real culture, and develop REAL bonds. Seriously, cement yourself into the local dynamic and you've effectively got the entire village as backup from now until the end of time. Anything from being picked up at the airport to a battalion of angry Thai's with enaps at your back.
My father grew close to my in-laws and made a number of trips there and just enjoyed the village life.
When he passed unexpectedly from liver cancer here in the US the village held a funeral in Thailand.
When we sent some of his ashes back (at their request) they had a small shrine/ash house ready for him at the village's monastery. They leave offerings for him (coffee + toast) every morning, and on holidays they bring the ashes to the home to sit in the room while everyone parties. The village children miss the "farang Yak" who would buy them ice cream, the adults miss the foreigner who would keep an eye on the rug rats in the center of the village.
It's a good part of the world.