Lilo is a really pretty name! I wouldn't pronounce it like Behind the Name says to, I would pronounce it Lil-oo. One of my favorite names is Lilu, which is also pronounced Lil-oo.
This is an incredibly unique and fun name. I'm surprised it's a German name, though-- I associate this name with Lilo & Stitch, as I'm sure many people do, and it takes place in Hawaii.
This name may very well be a German nickname, but it is also a Hawaiian name that I read means either, "Generous one," "lost," or "lonely," any of which make it appropriate for the little girl in the Disney movie. It may be male or female, as many elements of Hawaiian names are. I think this is a pretty name and despise the fact that people now associate it with Lindsay Lohan thanks to the stupid tabloids need to give celebrities nicknames.