Which one is more acceptable (best-practice)?:

namespace NP
   public static class IO
   public static class Xml
   ...
   // extension methods

using NP;

IO.GetAvailableResources ();

vs

public static class NP
   public static class IO
   public static class Xml
   ...
   // extension methods

NP.IO.GetAvailableResources ();

Also for #2, the code size is managed by having partial classes so each nested class can be in a separate file, same for extension methods (except that there is no nested class for them)

I prefer #2, for a couple of reasons like being able to use type names that are already commonly used, like IO, that I don't want to replace or collide.

Which one do you prefer? Any pros and cons for each? What's the best practice for this case?

EDIT: Also would there be a performance difference between the two?