I would just like to say (for what it is worth) I am the first born daughter, and I have the same name as my Grandmother, Great-Grandmother, Great-Great-Grandmother... And my mother hated it, because she didn't have any choice in the matter and held a HUGE grudge against using it. For years I followed her lead. Now my eldest dd didn't get the family name, but now, I realise the implications of this. I have something beyond blood that connects me with these wonderful women, and that alone makes my name really cool (even if it does sound weird and old fashioned, and I always have to spell it out... but again, I now feel this adds a little kudos! ...I am digressing!) My point is, that I broke that line, and my dd1 has missed out in sharing this joy, and the sense that she doesn't belong to our 'club' as she feels she ought to(she is really quite cross with me). If I could give her my name now, I would!
So I would say to you that actually, I think you did the right thing in naming your son in this way, and PLEASE don't pass that grudge down to him! It will mess up his self identity for years to come! As a child, I was so ashamed by my name because I knew it upset my Mum to hear it muttered aloud and would mutter it quietly if somebody asked my name - I even started to tell people I was called something else, which lead to a whole lot of trouble!
As the recipient of an old family name I think it is wonderful to have, it distinguishes me, I have great fun with my Grandmother teasing people when one or the other of us is called to, and we giggle about the silliness of such a name - I wouldn't swap it for the world! As for bulling, I got picked on at school far more because I was funny about my name, than because it was old fashioned and unusual. If I was able to develop the name connection with my Grandmother earlier, I wouldn't have given a hoot about anything anyone could have said about it, as I would have seen it as I do now: as a very special name, passed down from my father with love.