I have a small AJAX enabled ASP.NET application, working fine
saperately, When I put the application inside sharepoint with all
neccesary changes in the application.master and web.config file my
application is running under sharepoint 2007, but problem is that it is
not showing ModalPopupExtender in a proper way, actually it is not
picking the style sheet I have in the same aspx page not out side the
page.

I googled this issue and I found that if we change the DOCType of the
HTML it will work, I changed it and I found that AJAX running fine but
the style sheet using by sharepoint master page is disturbed. How can I
solve this problem.