I'm okay with O'Shea at 3 years, as that is a pretty "standard" extension. You've had 3 years to evaluate what he is. If you (as in the club) are happy with him, believe he is your guy, then you make the commitment. If you don't believe he is that guy, then walk away.
Walters for 5 seems a bit too much, especially given that he is already under contract next year, so you are really committing to him for the next 6 years.
I'd rather that extension wait until mid season next year when we've had a chance to see if this team is for real or if this season has been a bit a blip.