My mom's a nurse, and has seen such gems as Chewbacca Digs, Tequilla, and a boy whose name was pronounced shi-THEED. It was spelled, however, in a manner that Eric's grandma would not approve of here.
As for characters, I've seen and used several silly names and mundane names. I had a fraal sorceror named Pip (after the pips on the dice) because I had to use him faster than I thought, and blanked. I had an elf rogue named Jack. Ohg the half orc fighter ("Not Og, OHG!!") turned out one of my best characters ever. I've also had plenty of random NPC Bobs and such.
I've seen NPCs with all kinds of silly or common modern names. Sometimes they break the mood, sometimes they don't. I've seen a player name a character Verlander (after the baseball player), and the same player inadvertantly named a character after a feminine personal device. Another player had heard of the device in question (go internet!) and teased him mercilessly until he changed it. The teaser has, in my most recent campaign, named his character Blackleaf, and his goal is to hunt down Jack Chick, who is either a bad guy from his past, or some sort of mysterious monster (I forget which).
I don't freak out over odd names. I don't find it worth it. Sure I might sigh and try to talk a player out of something truly obnoxious (though I've never had to), but I'm not going to wig out because someone chooses a name with a different feel than the naming conventions of the area they're in/from.
I also don't have a problem with names used in modern english, especially those that were in use a long time ago. In fact, I would rather see people with names like Maggie, Jack, Elizabeth and David than have everyone named with long, fancy, fantastical names. Sometimes it just sounds overdramatic to me. A few old mercanaries named Bob never hurt anyone.
And every village in my world has an old man named Plah Took. Every one.