>The file extension is used to deterine the file type; for each file extension, there is an entry in the registry under HKEY_CLASSES_ROOT specifying a relation to a ProgID for that file extension, and one of the items stored beneath the ProgID is the Default Icon for that file type.
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>The implication is that the file extension specifies the registry-associated behavior for the file - what happens if you click on the file or right-click on the file in Explorer is determined by the Shell entries under the ProgID, including the default behavior (normally "OPEN") and the specific entries shown on the context-sensitive menu.

OK. This makes sense, as in attempting to open a file without an extension causes a dialog box to appear. Then the user selects which program to open teh file with? As opposed to a .txt file or a .dat file which on double clicking opens up in notepad. Am I understanding it correctly?

Thanks again for your time in helping me understand this differnce.