Can you extend a wireless connection from one time capsule to another wirelessly?

On the main TC, select the wireless page in the airport utility.. check the "allow this network to be extended" box.

In the secondary TC.. connect to a computer by ethernet to do the setup.. on the same wireless page, click on the options under wireless mode.. select extend a wireless network.. and put in the details of the wireless network you are joining.

A TC is an awful expensive device to use as a wireless print server.. you could have bought a new wireless network printer for less.

Could we possibly extend the wireless network to the second time capsule

Yes, if the second Time Capsule is located where it can receive a good wireless signal from the other Time Capsule.

To test, move a laptop to the proposed location of the second Time Capsule. Log on using wireless on the laptop and spend some time to make sure that you have a good, solid reliable Internet connection. If you do, then the Time Capsule should work well at that location.

You would use AirPort Utility to configure the second Time Capsule to "Extend a wireless network". If you open AirPort Utility now as a test, can you "see" both Time Capsules there?

The reason that we ask is that you might need to check some settings on the "main" Time Capsule to be able to configure the second Time Capsule correctly.

with the printer attached so we could use the printer as a network printer?

If the same printer works on your Time Capsule now, then it should work on the second Time Capsule. If it is working now, you may not even need to re-install it again when it is connected to the second Time Capsule.

This is one of those times when you will not know if something will work until you actually try.