I think it may be terminology used in NSW, at least, for the amateur division that the seniors play at. In WA the terminology is not used as far as I am aware either.

^ you are discussing this with a mutt who has never heard of the term "AA" ?

I wish you well [/shakeshead]

AA means All Age. (i.e. AA1 is the highest amateur level). We play 5 a side, no practice. For me this is extra practice for the full field.

The good player usually moves quickly back into a defensive position, I wouldn't say its cohesive though. It is more a cohesive unit with him off the field. The less good players often get caught out with the excitement of how fast he gets forward, then back and are really left in no-mans land for most of the game. I don't think in theory getting into positions to receive a pass is the problem, the lesser players can do that fine without the good player in the team, it is the good player insisting on playing a much faster pace than the lesser players can handle with their touch, thought speed and fitness.
When the good player's on the field the game often ends up being effectively a team of three with me, him and the goalkeeper. 

It sounds like you need your team coached in training to do a lot of work in getting  into effective  position just before players receive the ball. Obviously getting into the position where a player opens a passing lane at a diagonal angle in order to play forwards with effective body shape is useful as a player is closed down by opposition players is important.

It sounds like this may be a social type team, with such a range of ability in players ( I'm not quite sure what the AA means?) where there is not a lot of practice away from game day.

Also, as the very good player loses the ball is he quickly moving back into a cohesive defensive shape the moment it is lost? I'm assuming this h wis often in one of the most advanced positions on the  pitch.

 Is it 5, 6 or 7 a side? 

I haven't had problems with teams on the pitch in competition, but I've coached teams on the training ground with players with different skill levels who play against other teams in practice.

Has anyone had any problems with having players of vastly different skill levels in the one side play together?

My indoor side has several guys that in an outdoor setting would be about AA14-15 level and a guy that would be about AA1 level, with me stuck somewhere midway between. The team without the AA1 level player is competitive being able to work as a team in defence and attack at their own pace. With the AA1 level player we score many more goals but also concede even more. A hard fought 4-2 loss to the top side becomes a 10-5 loss.
With his higher level of fitness and skill level the AA1 level player wants to go on attack first touch after winning the ball back, which is good for scoring quick goals but it leaves the lower level players in a disorganised heap trying to keep up with him in attack. Once the ball is lost it becomes much harder to get organised in defence and the opposition gets a lot of free room to get a shot away.
I find that the harder the higher level player tries to play the worse the lower level players performances seem to get.

Usually I find playing with better players easier, even against much higher opposition, because they can fit into the system and read their teammates better giving everyone more time.