I wouldn’t recommend going to that lengths.
There’s a few like maybe .zero, or .exe, or something like that that we would definitely not recommend. But taking a URL, and taking the .php or the .html and adding a .free, or .cheap on the end is probably going a little bit too far. It’s not something that I would really recommend.
But probably, the number of users who saw that and thought that looked weird, or scuzzy, or strange, and didn’t click, would counteract any potential benefit. And I’m not sure that it would work all that well anyway. So I would go ahead and use whatever filename suffix you think is appropriate: .php, .cfm, .aspx, .html, whatever. But I wouldn’t make it .cheaponlineviagra or something along those lines. That’s probably taking it a little bit too far. Thanks.
by Matt Cutts - Google's Head of Search Quality Team