As said before, the Extension propagation is an addition to the Source propagation.
The only Extensions you will be able to propagate are the Extensions located in a Source (an InfoSource parent). Therefore to propagate an extension, you will need to configure its sibling InfoSource to propagate.
Now that you can propagate an Infosource, all its sibling extensions (except the proxyExt which are already propagated with the Source) will be propagated.