You are correct about both. If your center pawns are over-extended, then your oppenent can easily strike back. A sharp position is riddled with tactics, dangerous for both side.
The King's Gambit is sharp. The Sicillian is sharp (the dragon is very sharp).

Could some one give an example of "over extended" and "sharp".
I presume the former is a pawn roller that advanced too early and "sharp" being a position that is riddled with tactics?