Can you give us a hint about the sound of the baby's last name?  That makes a lot of difference.

Lily and Rosemary as a sibset reminds me of the Bob Dylan song "Lily, Rosemary, and the Jack of Hearts."  I'm a Dylan fan, so I kind of like that, but you might feel differently.

Isabel or Evelyn would work nicely.

depending on the sound of your last name, i would go for either Eve Marie or Eva Marie or Eva Rosemarie

Perhaps I am the only one who remembers Eva Marie Saint.  Of the inspiration names you listed, the one that strikes me is Odile.  Rather oddly in the recent thread on Ottilie, Odile was the only version of the name that wasn't mentioned (if my memory serves me).  While Odile is not as much of the current moment as Lily is, I don't think that the two names clash.  Rather I think they go together quite well. 

I also thought of Eva Marie Saint.

I adore the name Eliza, but Eliza and Lily both seem like Elizabeth nns. I don't know that that's true, but it's the impression I have of them together. I'm sure one of the true experts on this site will set me straight. On the other hand, I think something like Elise would be lovely, so maybe that makes no sense....

I'm not a particular fan of Eden compared to Eva or the other inspiration names you listed. I don't dislike it; I just don't feel like it has the same sweet charm.

I personally Adore the name Jane, so Jane Marie would get my vote.

If all else fails, I also advocate for going with the name that would most please your mother in law-or whomever the pickiest member of the family may be!

Other thoughts....

Ella? Molly? (A Mary nn and a combo of Mary + Ollie) Olivia?

I just saw Vida on your list of names- would Vivian/Vivienne interest you?

Other options for traditional, easy to spell and pronounce E names: Edith (Edie), Elodie, Ellen, Eleanor, Estelle, Etta, Esther.

As another comment pointed out, Lily is originally a nickname for Elizabeth. It's definitely a stand-alone name by now, probably influenced by flower-names in general, but for siblings, I wouldn't pair Lily with Elizabeth or Elsie or any other Elizabeth-derived name. (My friend Lisa, middle name Beth, would agree with me: she recalls being sorely disappointed to learn that her parents had given her the same name twice.) You can consider Elizabeth and Elsie to be "done": honored already with your first daughter's name. I think you can cross off Lynn as "done" as well: Lily is kinda like the modern version of Lynn, in terms of feel, general sound, and popularity.

If the middle name has Marie in it, then Mary can be crossed off, which leaves:

Eva, Jane, Rose, Louise, Odile, Ollie, Catherine, and Vida.

Of these, Eva and Jane are the most appealing as sisters to Lily. Rose would be too themey, Louise repeats the initial (not necessarily a big issue, but it's a point against, anyway), and Catherine looks a bit too long, comparatively. (It's not really much longer in sound, but it's more than twice as many letters as Lily.) Odile and Vida I'm not sure how to pronounce, and Ollie doesn't look feminine.

While it's tempting to combine names in the middle spot in order to honor more people, I'm not sure the idea works with a sibling with middle name Anne. Your children may feel gypped by the unequality. A classic like Rosemarie is as far as I'd go: at least rosemary is a plant, same as lily.

Jane Marie works best for me in terms of rhythm, although your surname may influence that. (I know you posted it in a comment, but the forums interface only shows the one message you're replying to, so I can't see the comment, and I don't remember what it said.)

I love the idea of using Rosemarie as a middle! I think it plays off of the floral theme of Lily's name nicely, without being too in-your-face by using another flower for a first name.

Eva Rosemarie
Ella Rosemarie
Ellen Rosemarie

My second-favorite middle would be Marie-Louise. 

Eva Marie-Louise
Emily Marie-Louise
Eliza Marie-Louise
Elodie Marie-Louise

And if you're going to use Marie alone as a middle:

Eloise Marie
Louisa Marie  (Nicknames Lucy, Lulu, or just Lou)
Eliza Marie

Eva Marie is my vote

Thank you all for your advice!  It is so good to read other perspectives. 

Out last name is pronounced gehdree. 

I like Eva Marie (except that a google turned up the actress +a nude model). Do you think Eva Rosemarie is too old lady ? Also is Eva going to be a pronunciation problem? We are from the SOuthern US and pronounce it as Eevuh but my neighbors speak Spanish and pronounce it ehvah. Our last name is hard enough to pronounce- I'm a little concerned that she will be frusterated with her name even though I like both pronunciations. 

I liked the suggestion of Elodie but are 2 Ee endings going to be too much?

Thank you all!

Eva Marie or Julia Marie are my choices.... (althugh I was using the expert matchmaker, is that cheating?)

Eva sounds...older than? not as sweet as? Lily Anne.  I don't know any real-life Evas, so I think the name is heavily influenced my Eva Mendes and Eva Longoria in my mind.  Eliza, on the other hand, matches the sweetness of Lily Anne better.  To me, the long-ago assocations of Lily as a nickname for Elizabeth are a non-issue.