I'm currently traveling around Scandinavia (main cointry is Norway) on a single entry Schengen C visa, but would like to travel to Croatia for a short holiday before returning to Norway, then back to my home country in Asia. However, the Croatian Ministry of Foreign Affairs website says they allow holders of the Schengen visa entry into the country if it's a two or multiple entry visa. Is it possible to obtain an extension of a multiple entry visa while still in Norway or the Schengen area?
It's simply not possible, you need to apply where you reside. You could apply for a Croatian visa (although I think they have the same rules) but you would still have no easy way to reenter the Schengen area.
Depending on your citizenship and situation, an alternative could be to apply for a national long-stay visa, see Is it possible to extend my 90-day short stay in Sweden by 10 or 15 days? Such a visa would give you the right to go to Croatia and reenter the Schengen area.