I would go for the tile only too, that will give you a more sleek modern look. Most designers that I work with recommend to do only one of the 2: either granite back splash or the tile. Of course it also depends on the granite color and type of tile too. Any particular color that you like?

We have oak cabinets that we are not replacing. We are getting stainless steel appliances. We were thinking tropic brown but our installer suggested antique brown for more contrast. We are going to have a look at that tomorrow, taking a door with us. Worried that it may be too dark.

Consider your floor color as well. I vote for tile only, just make sure the grout is either an epoxy or will take a penetrating sealant. Bring home some samples after the counters are installed.

The floor is pretty much the same color as the cabinets.

I think that Tropical Brown might be too busy for a small space (on the picture it appears small to me). If you like the browns you might like St. Cecelia or New Venetian Gold
St. Cecelia is a Level 1 color, if you have an option for upgrading you may look for a more relaxed pattern like Madura Gold
Antique Brown is a rather dark color. We have it in our showroom, and to me its more black than brown. Among the deep brown colors are Capolavoro, Minsk Premium, Magma Gold. And of course all of them are High price colors:)

Thank you everyone!
We've chosen black pearl granite in a honed finish and are doing a tile only backsplash. The counters should be installed late this week or early next week. The next decision will be what to use for the backsplash. I'll be back with photos and requests for more advice. :o)