Timecapsule and Airport Express issue

Hi

I have an Airtel PPPoE connection through a DSL modem and router. This is connected only through an ethernet cable to my TimeCapsule (I have disabled wifi on the DSL router). The timecapsule is setup in Bridge mode and creates the wireless network in the house. It has the same network name as the DSL modem and router.

Now comes the tricky part (which it should not be!) - I have another Airport Express in another room through which I want to extend the wireless signal from the TimeCapsule. However, every time I try to put the Airport Express in Bridge mode and try to select 'Extend a Wireless Network' - the TimeCapsule reboots every 5-6 seconds and the network goes down. Same for the Airport Express.

Right now, I have the Airport Express setup to 'Join an Existing Network' and in Bridge mode and the signal stays - however, I feel this is not giving me a good signal and there is considerable loss in speed on the network. I had the Airport express setup earlier to extend the signal and I feel that works way better.

Please help in resolving this issue.