Recent experimental progress in cavity optomechanics has allowed cooling of mesoscopic mechanical oscillators via dynamic backaction provided by the parametric coupling to either an optical or an electrical resonator. Here we analyze the occurrence of normal-mode splitting in backaction cooling at high input power. We find that a hybridization of the oscillator's motion with the fluctuations of the driving field occurs and leads to a splitting of the mechanical and optical fluctuation spectra. Moreover, we find that cooling experiences a classical limitation through the cavity lifetime.