I am adding a feature to my application that allows users to backup an entire SQL database, as well as include application settings with that backup file. My dilemma is choosing a good file extension to use.

The over-used .bkp type could cause conflicts in systems that have applications that already create a file with that extension.

I know that Microsoft recently started creating 4 character extension .docx etc... and was wondering what people thought about using extensions with 4 or more characters as well as just selecting file extensions in general.

Use whatever makes you happy. Microsoft added the 'x' to things to indicate that they are now in XML format vs. their old formats. Use 'backup' if you want :)

I considered just using .databkp. I just want to make sure that the extension is:

1) easy to remember for a user
2) unique enough that conflicts with other programs are limited.

I'll have to think about this a bit more.