I had a choice of doing this, too, but went a different route. Since I was remodelling a kitchen completely from bottom up, I used the same tiles that I used on the flloor. There were several left over, and I tiled them up to the cabinets. The cabinets are white and the tiles are grey with a blue design in the center. It's easier to keep clean this way. rather than using 4 x 8. It gave a matching look to the small area involved, but if the kitchen was larger, I'd have chosen different tiles but would still have tiled up to the cabinets. Just my experience and opinion.

I would tile up to the bottom of the cabinets or do a 4" backsplash that was the same as the countertop.

I agree with Cabinets by Design!

Do the whole wall with tile, or 4'' with the same material as the countertops.