What are the pros and cons of creating extended stored procedures?
The pros are that you can implement additional functionality and access data from DLLs from within SQL Server. If you need to do something that can be done only in C or C++, or if you have data that can be accessed only outside of SQL Server, you can still provide a link to it.
The biggest con to extended stored procedures is that they run in the same process space as SQL Server. So an errant DLL could overwrite memory and cause SQL Server to crash or even corrupt data. The biggest safeguard against these problems is thorough testing of the procedure.