The maximum amount of lives and bombs you can get in Story of Eastern Wonderland is 6 lives and 5 bombs. Even if you have a high score and you’ll hear the “Extend” sound you won’t get any additional lives if you already have 6. But if you have maximum lives and lesser bombs when you’ll hear the “Extend” sound you’ll get a bomb instead of a life.
The stage 4 midboss usually gives you 1 bomb and 1 life if defeated. But if you already have maximum lives, she’ll just drop a B item instead. If you do not have maximum lives and you defeat the second appearance of the stage 4 midboss, she will drop a 1UP. However, if you get an Extend right after that, which puts you to 6 lives, the 1UP will not count at all when you will collect it. It will not increase the bomb count either.