I need advice and a new middle name!!!

So my SIL has a 16 year old with the middle name Grace. I text my niece and asked her permission to use her middle name, Grace, for our daughter who is due in January. She told me she didn’t care at all and seemed excited about it even. Well my SIL texts my husband, and seems really upset over it. She said Grace is already a name in our family and she feels like it shouldn’t have even been an option for us. I’m really upset that we have upset her over this, and I’m also upset we don’t have a middle name for her anymore. I need advice and a new middle name please😢