My cabinets end 5 inches before the granite countertop. I designed my kitchen this way because we expanded the kitchen but I did not want the cabinets running too close to the window in the breakfast nook. I would also consider tiling the wall in the breakfast nook as an extension but right now I am not sure what to do. If you have any ideas or opinions I would like to hear them.

This is really one of those 'how it looks to you' kind of things. Usually, your eye will follow the countertop so you would want to end the tile even with the top. However, if you also have wall cabinets that line up with the base cabinets below then it would also look OK if the tile lined up with the edge of the cabinets - leaving that 5" of countertop without any backsplash behind it.

I would get some samples of the backsplash tile and hold it up in both places to see how it looks.

The base cabinet sticks out farther than the wall cabinet. I have tried to find backsplash tiles and whatever I look at I don't like. Do you think I could tile the backsplash and the breakfast nook wall above the chair rail with the same large tile. I do not like small tiles because it makes the kitchen look too busy. This is a house built in the 60s and it used to have hanging cabinets over the counter which we removed and then moved the kitchen out 7 inches to make it larger. I did not put the upper cabinets out to the end of counter because I did not want them too close to the window in the breakfast nook. Thanks for your input.

You can use large tile - but if you do I would recommend installing them on a 45 degree angle. Otherwise large tile tends to take up all the space between countertop and underside of wall cabinets - makes for only seeing the vertical grout line so it looks strange.

Also, most tile comes with matching bullnose trim. You'll probably need this to make a stop point at the end of the run - no matter if you end it even with the cabinet or the countertop.