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Gretchen is cute. It gives off a similar vibe as Gretel (without the witch in the oven) or Liesel.

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The description of "ugly, old lady-ish, and completely unappealing" sounds like Gertrude or Agatha.

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For a middle name, something soft that smooths the stronger sounds of the first name.
Gretchen Anneliese
Gretchen Leonore
Gretchen Violet
Gretchen Rosalie
Gretchen Isolde
Gretchen Mneme

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For Gretchen's brother Peter or Nathaniel. A sister might be Lucinda "Lucy", Henrietta, Alice, or Beatrix.