Is it possible to make the extract with Crème De Cacao instead of vodka? I ask because I have some Crème De Cacao that I used in making a Grasshopper pie, but it is only "17.5"% (35 proof)" I don't know if this will be strong enough to do a good job, or should I half it with vodka?
One of the first things you'll need to consider is that the creme de cacao is already chocolate-flavored. Vodka is very clean and neutrally flavored, so if you use it to make an extract you'll get a very pure flavor extraction from whatever you're infusing. If you use something that's flavored already, the end result will obviously contain those flavors too. Basically, extracting vanilla flavor with creme de cacao will not give you a straight "vanilla" extract - it will be "chocolate-vanilla". That's not necessarily a problem, just be sure that you have the right expectation going in.
I do a fair amount of infusion at home (usually for cocktail use rather than baking, but the principles are similar) and have found that flavors tend to be best extracted in spirits that are at least 100 proof (50% alcohol by volume or ABV). Additionally, sugar can inhibit the flavor extraction. This makes your creme de cacao problematic because it's both not strong enough and contains quite a bit of sugar. I don't think you'd get a good extraction by using it on its own.
Simply blending with vodka might help, but only marginally. Most vodka is sold at around 80 proof (40% ABV) so if you did a half-and-half mix, you'd wind up with a solution at around 55 proof (the calculation of ABV isn't purely additive, so calculating the exact ABV would take some math that I'll attempt to add in later once I can track down the formulas). That's not enough of an increase in proof to make much of a difference - might as well just use the vodka at that point.
You could do better by using a stronger spirit. Some brands sell 100-proof vodka which would bring your half-and-half blend up to around 65 proof. It's possible to find some rums and grain spirits sold at 151 proof; blending with those would get you up to around 90 proof. You may even be able to find 190-proof grain alcohol under the Everclear label (though this is illegal in many jurisdictions) which if blended would bring you all the way up to 110 proof, which should be enough for a good extraction even given the sugar content in the mixture.
Of course, if you're going to seek out these specialty products, you could just use them on their own and get a much better, cleaner extract. If you're dead set on using the creme de cacao (or in the general case, any liqueur) you could probably find a way to make it work, but on balance I'd recommend finding a different use for it.
If you're trying to make vanilla extract, I wouldn't use a flavored alcohol... Even if it's feasibly possible in the lower-alcohol liquor (which I'm not certain of), you won't have the flavor you need... you'll have chocolate vanilla and, considering how strong the flavor is in most Creme de Cacao, I'd be surprised if you noted a change in the flavor at all.
The reason vodka is such a good option is that it's very high in alcohol and (assuming it's a good-quality vodka) it has a neutral flavor, so all you get is the vanilla in the end.