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I think it's kind of neat because I love Arthurian names. The problem now though is it's also the name of a car. :/

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I don't know if people would really think it was a weird name. Have you seen the made-up stuff people are naming their kids these days? :P But a lot of people might think of the car and not know about the mythical place.

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I'd try pairing it with something elegant. Like:
Avalon Claire (ooh, love this!)
Avalon Eira
Avalon Juliet
Avalon Lydie