What is the car on which you have the extended warranty?
If it's something reliable (Honda, Toyota, Nissan, Mazda), I'd drop it.
If it's something unreliable (VW, Audi, Chrysler, Dodge, all other Euro brands), I'd drop it.... and sell that car, replacing it with something reliable.
If it's something in between (Hyundai, Kia, Ford, GM), I'd probably drop it. I'd accept the minor chance of major parts (engine, transmission) failure, and can repair/replace minor parts (everything else) myself.
YMMV and all that.
P.S. The extended warranty covering a free rental car is of minimal value to you, because you have a second car you can drive anyway, while the other is out of service.