What is the exact difference between 'fully extinct' and nihilism?
There should be a distinction made between "nihilism" and "annihilationism".
The first one is about "non-existence of kamma (its seeds or fruits or both)".
(to read more about the term itself - http://en.wikipedia.org/wiki/Nihilism" onclick="window.open(this.href);return false;)
The second is about "non-existence of self".
I get the general impression that people who tend to call themselves "Buddhist atheists" (mainly found in the West) practice the dhamma more diligently than a lot of "religious Buddhists" (mainly found in the East).
I see it otherwise. Western "Buddhist atheists" do not do Dhamma. They do only meditation.
While eastern "religious Buddhists" do Dhamma, though, they may neglect doing formal meditation (like "retreats" and so on).
Also, believing in rebirth is not the same as having right view.
Believing in rebirth is an essential part of Right View. This factor can never be completed if one has such a Wrong View as "There is no rebirth".