MacBook – Should I use an extension power cord instead

Yes - the computer side of things is the same, but the newer cord layout is needed for Airs or when the space around the port is restricted.

The 'L-shaped' MagSafe adapters were just a newer design which meant the cable went backwards instead of outwards. They should fit just fine and I've used one or two third-party ones in the past. Just as long as you pick the right power-output you should be fine. Here's a TUAW article on the matter

According to Apple knowledge base entry HT2346 the 85W power adapter is the right one. However, there seem to be issue with "T" style (the old) vs. "L" style (the new): see this thread. It seems that for some people, a workaround does the trick:

Turn off your computer, flip over the laptop and remove the battery, hold down the circlular button on the battery for 10 seconds, the green light should go out. Re-install the battery and turn your computer on. Your new charger should work fine.

If that doesn't work, you need to call Apple support to arrange for your power adapter to be replaced with a "T" style adapter:

Apple is aware of the issue with the pins being at a different depth in the new chargers with the "L" shaped connection. After having two new ones not work, I contacted tech support. They sent a new version of the old charger with the square mag safe connector. It works fine.

Edit: Apparently the MacBook SMC Firmware Update 1.4 should fix the "L" style power adapter issue on older MacBooks.