If a sibling of yours or your OHs asked you permission to have some photos of your dc on Facebook - and you agreed - would you be alright with seeing that they've used it as their MAIN profile pic (as opposed to having it in a photo album) for over a year? Not a pic of FB user+your dc but just your dc.
If you were a friend of said FB user would you find it odd that a 35 year old woman is using her baby niece's photo (she does say it's her niece, she's not pretending the child is hers or anything) to identify herself on FB?
s'a bit odd but perhaps she is just inordinately proud of her niece? When my first niece was born I did a huge email out to all my friends with the pic of her, even though she wasn't my baby - even I thought I was a bit sad but hey!