It might be natural to read 'Gilly' as an abbreviation, perhaps for a name like 'Gillian'. Actually, given the Hobbits' preference for naming girls after flowers or jewels, the name 'Gilly' probably has a connection to the gillyflower (which is a name given to various different kinds of flower, including varieties of carnations or wallflowers). As part of this flower name, gilly derives via a circuitous route from Greek κάρυο, 'nut'.
The gillyflower's name is pronounced with a soft 'g', so assuming that Gilly Brownlock was named for this flower, her name would be pronounced as 'ji'lly'.
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