“Old German male forename, the origin of which is debated: Rather than from Old High German “kar(a)l”, man, husband, the name should be derived from a pet form of a name formed with OHG “heri”, army,” to which the Romanesque pet ending “-olus” was added within the area, where Westfrankish and Romance speakers mixed. Also, the initial K can easily be explained: the Germanic H was represented by a C. Another argument for this derivation is the fac, that during the early Middle Ages the name alsost exclusively used among the members of the Merowing-Karoling House. It wasn’t until the fame of Charlesmagne and the circle of legends around him spread, that the name came (back) to Medieval Germany . (…)”
Both Kohlheim and Seibicke refer to H.Kaufmann. So if you are interested in what he writes, let me know. But it will take me a while to translate his stuff, it's highly scientific.