Prior to ArcGIS 9.2, spatial references were low precision. Each integer coordinate was allotted 31 bits rather than the 53 bits provided by high-resolution spatial references created and maintained with versions 9.2 and higher. If you created your data prior to ArcGIS 9.2, migrate your datasets to allow them to store high-precision spaital data.
With a high-precision spatial reference, the resolution and coordinate system define an extent for your dataset, cutting out the need for a user-defined domain extent. The default resolution of 0.0001 meters is precise enough for most data and does not restrict your extent as a low-precision spatial reference would. Therefore, there is no need to strike a balance between domain extent and resolution with a high-precision spatial reference since it offers both in unison.
Converting geodatabase data to high precision requires the following two steps:
For more information on converting to high precision via this and other methods, see Migrating to high precision.