Can I extend AP Extreme Wireless network with my a TC and also use TimeMachine with it?

I currently have an Airport Extreme Base Station in my Home Office in the basement and would like to purhcase a TC to be placed upstairs to extend the Wireless Signal and also use it with TM to backup several apple computers.
Do I need to run a Network Cable from the AE in the basement to the TC unit or can I simply piggy back off the wireless signal produced by the AE?  I can do either, but just want to make sure I get what i'm looking for.
I'm also running Apply TV in many rooms....will the TC unit produce a new wireless signal or extend the wireless already in the house.  This is critical as Apple TV Units and the device connecting to it must be on the same network.
Thank you for your help in advance.
david

I currently have an Airport Extreme Base Station in my Home Office in the basement and would like to purhcase a TC to be placed upstairs to extend the Wireless Signal and also use it with TM to backup several apple computers.
That is doable.
Do I need to run a Network Cable from the AE in the basement to the TC unit or can I simply piggy back off the wireless signal produced by the AE?
Wired Ethernet cable connections are strongly preferred in setups like this, since there is no speed loss in a wire....and much less chance of an error occuring over a wired connection. The wireless signal produced by the Time Capsule will be much faster with a wired connection as well.
Wireless between the AirPort and TC might work.....IF....the Time Capsule is located where it can receive a really strong signal from the other AirPort, but at best, the speed will drop by about half when you do this.
I'm also running Apply TV in many rooms....will the TC unit produce a new wireless signal or extend the wireless already in the house.  This is critical as Apple TV Units and the device connecting to it must be on the same network.
The TC will extend the existing network using either a wired or wireless connection.

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