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Kevin, Ideally your cabinets want to sit on top of the floor to get proper height. A new floor may not be in the budget but sounds like your getting new cabinets so the Question is How to build up the floor.
First off you will want to get all cabinets out....then build up floor SOLID makeing sure the top layer of this floor is what we call Cement Board(This is sub-strata material that should be used under all tile floors) Leaving it below the top of tiles so new tiles will match height of old.
Tile the area (if me I would tile it complete in case I wanted to change at a later date).
place new cabinets.
Gerry
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