A friend of ours was pregnant about 8 weeks before we were, she actually said to us that if we had a favourite name we should tell her so that she would not name her baby that. Her reasoning was that she'd already had 2 girls, she'd used her fave names and was working on a list for the third, if it was a girl.

DH and I said we'd think about it but never gave her our prefs - we just thought if she chooses one we like, we'll get over it.

They ended up having a boy so its not a problem...

I think it depends too on how much you think you'll see the child with the stolen name. If its infrequent, who cares? But if they are a close friend, it might be a bit weird - IMO anyway!