I got the popupextender to work without having to change the the default.aspx page:

this is from: http://geekswithblogs.net/chrishan/archive/2007/04/02/110612.aspx

1. Have a panel control wrap around the drop down list and your SearchList control.
2. Create a stylesheet class like this:
.DDLPanelListSearchExtender
{
    position: relative;
}

3. Specify the CssClass property of the panel control you added at the first step to this new stylesheet class DDLPanelListSearchExtender

You can feather use the theme to simplify this task by adding a Panel.skin which looks like this:
<asp:Panel runat="server" BorderWidth="0px" CssClass="DDLPanelListSearchExtender"/>