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I'm thinking of replacing my home router (an older D-Link box) with the latest gen Airport Express base station.

I currently have an older Airport Express unit (like this) that I want to use in another part of the house to extend the network, but not sure if the latest Express units can be extended...

Or do I need to get the Airport Extreme to function as the base?

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I think you should be fine. I have an older AirPort Extreme (the flat, square one), and I’m using that model of AirPort Express to extend my network. Works fine. – alexwlchan Jun 17 '13 at 22:53
up vote 1 down vote accepted

Looks like the answer is Yes.

From Apple Forums:

The AirPort Express can only "extend" a wireless signal....using wireless only....from another AirPort Extreme, Time Capsule, or AirPort Express.

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