My friend gave me a leg drop extender like this and he added an army m9 holster to it. I can not figure out how to use it. Do I just use the molle straps to loop it onto my belt? It seems it would ride a little lower that what it does though. Any help would be appreciated. Thanks

You are correct in how it is used.  Similar to this picture.  Keep in mind however, that in general one of the easiest ways to detect a Pogue is by how low their holster sits on their thigh.  The point of a drop-leg rig is to get your sidearm below any gear/armor.  But, when the weapon rides down here, it's going to flop around when running more than quadruple D's in a t-shirt.  The holster should be adjusted to ride as high as possible and still clear your gear.

Yea, the first picture is perfect. I understand the concept behind the thigh holster, but they way the one I have looks, it hooks directly to my belt from the rear Molle straps and makes the pistol no lower than using a regular belt holster which is not low enough to clear my jacket. Is there a buckle to buy similar to the first pic to attach to the rear of the holster to drop it a little lower?

If you're using a standard M12 holster, the spring clips in back should interface with any of the MOLLE straps on the front of the drop piece to get it at max about 5" lower.