Files and Folders aren't just differentiated by 'extension'. In fact, extensions aren't really anything special - they're just part of the filename (windows can be configured to hide that part of the filename, but in reality, the extension is just a string).
You can try this yourself, on linux, if you type "ls -l" you'll see a list of properties preceeding each file, something like this for executables:
-rwxr-xr-x
or this:
-rw-r--r--
for non-executables. The properties are separated into categories - owner, group, and other - and each is given permission to read (r), write (w) or execute (x) a file.
see chmod man pages if you want more explanation: http://ss64.com/bash/chmod.html
A folder isn't like a file at all. It's an entry in the file system that simply says that there's a folder there. You rename a folder to something.exe and it still won't be executed (same on linux too)
Btw, a folder's properties on linux look like this:
drwxr-xr-x
That first letter (d) indicates its a folder on the filesystem.
Renaming a file that's 'executable' to whatever extension will stilll let you run that file from the command shell in linux. Windows is another story, that I'm not 100% sure of. It seems like it does treat files based on their extensions (for executables I mean).
Oh, and filenames in linux can't contain /. (though they can contain all other sorts of unreadable and impossible to use characters.. including newline..yeah...)