The DarkGreener website is great for things like this. Here are the charts for Theo and Theodore. Combining the spellings, there are more Theo & Theodores than Oliver. While a smaller percentage of babies are given the most popular names than a generation ago, I'd still call it crazy popular.
As for is it a fad, that's hard to tell as it's still rising. Personally, I'd be surprised if the popularity will last longer than this generation of babies, if that's what you mean by a fad. I think Theo(dore) will end up a 2020's names. Name trends these days tend to move faster than they did in the past.
I think Teddy is avoidable, as Theo is the more intuitive nickname and I can't see adults randomly calling him Teddy. There is always the chance that he would prefer Teddy for himself (but there's also always the chance that he'll use his middle name or change his name to something else).