I know 4 under the age of 5, plus a handful that are older (but all younger than high school).
Even if there aren't any in your circle, there are a lot of little Lilys running around and your Lily is eventually going to be in the bigger world and find that her name is very, very common. It's a beautiful name and you should use it if you love it, but I think sometimes people convince themselves that a name's not really popular just because they haven't run across it much.