This is the way to do it:
1) Connect both mixer via Ethernet cable ("Network Audio"). The blue cable which came with the mixer is of the right type. Switch on the console first, then the rack mixer. After booting both mixers are now communicating via AVB.
2) Press the "Home" button on the console -> Audio Routing -> Stagebox Setup. The 16R should already be listed there. Give "Preamp Permission" to SL 16 and select "Stagebox" as mode for the 16R. Hit "apply" to confirm the setting.
3) Go back to "Audio Routing" and select "AVB Input Stream". Then select "Input 17-24" on the left side and on the right side select "StudioLive 16R: AVB 1-8". Then click on "Input 25-32" and select "StudioLive 16R: AVB 9-16". Go back to "Home".
Now you have routed the 16 inputs of the 16R to channels 17 to 32 and on your console you can see that "Network" is selected as input source for channels 17-32. And because the SL 16 has "Preamp Permission", you see Preamp Gain in each channel. The outputs (Main L/R and Flex Mixes 1-6) are automatically routed to the outputs of the 16R. There is no way to use "more" outputs or change the order. It's a fixed setting.
It seems that you have bought the 16R after July 1st, so you now own the complete Fat Channel plugin collection. It should be registered with the 16R. Go to your PreSonus account and follow the instructions. Basically you only need to load the collection in UC Surface and activate it. After a restart the will show up in the Fat Channels. You can install the plugins on both mixers.