1) Amy Josephine ("Amy Jo" for short): this is currently Steve's favorite, and I like it too.
2) Josephine Marie (not sure about the middle name, but "Jo Jo" for short). This was an early favorite, and I still like it. I especially like the sound of "Elizabeth and Josephine" as names for sisters.
3) Natalie a classic, but unfortunately no good nickname comes to mind.
4) Julia also a favorite, but right now it doesn't sound as catchy as the others. Not sure why.
This is what we've got so far. Any other suggestions, please weigh in by posting a comment. You may have to sign up for a google username in order to post, but that just takes a moment.