I know Godparents crop up very frequently but please bear with me and offer your thoughts/advice.
DH is RC, I'm CofE, we live abroad in an RC country, married in an Anglican church and will happily mix and match between the two. We discussed baptism broadly before we got married and the general consensus was we'd have them baptised in whichever church we felt was our home church.
We're expecting DC1 now but feel our home church isn't the one we currently attend, which is more by default than active choice (choices are limited and this was the best fit). It also has a very transient population. And is RC which is an issue for me because the priest insists on promising to raise the child RC and only having RC godparents. Now I have nothing against RCs as godparents, in fact I'd actively like at least 1 godparent to be RC, but neither DH nor I feel comfortable with that arrangement so it's 2 strikes against that church and we've talked to our old home church - who welcome us back whenever we can and we've remained part of a homegroup there which has been am invaluable support - and the vicar is happy to do the baptism, which is great but now we have a deadlock over godparents.
1 is chosen already - my best friend who I've known through church for years, committed Christian (Anglican) but very ecumenical. Slightly on the evangelical side for DH but I think he might just be a bit scared of her 
Then we have 4 possibilities for a male Godparent...
- DHs brother. I have 2 problems with this - firstly he's not very religious at all, certainly not in comparison to DH and his sister. For me a Godparent has an inextricably religious role. Secondly he's family. My 2 family Godparents have never done anything Godparently - it's all been left to my other Godparent - whereas my siblings with no family Godparents have fared considerably better. DH says he'd be fun, which is fine but he's going to be an uncle so surely he can be a fun uncle? I don't want DC to feel hard done by if there are siblings with non-family Godparents and they seem to be getting more because DC1 has a Godparent doing double duty but nor do I want DHs brother to have favourites. And it would probably iffend my siblings, but they're not religious at all and I know they wouldn't step up and talk about God. I don't think DH's brother would either but I'm willing to accept there's a chance. The plus point is he's (nominally) RC.
- Another friend of mine. Plus points are he's religious and RC but it's another friend of mine so I think DH feels hard done by.
- A very close friend of DH's, Anglican. He would be fun and he's gone through a tough time so it would be nice to involve him. He's quite unreliable though and liable to disappear off the face of the earth for unspecified periods of time. I'm also not entirely sure how seriously he'd take the religious side of being a Godparent.
- Another friend of DH's. Extremely evangelical Christian and would probably be very unsupportive of anything to do with Catholicism. He's stable, (mostly) sensible and would take Godparenting seriously but it would be at a considerable distance. We don't live near any of them but he's by far the least reachable.
I have no idea how we decide. For me the number 1 priority for Godparents is religious support. I don't care what their affiliation is as long as they're a good example and willing to talk about it with DC in a balanced and supportive way. I would also like them to take a special interest in that child, which is why I've always said no family as it might lead to a perception of favouritism if they do and an uncaring Godparent if they don't.
DH sees it more as honouring important people in our lives and I know that's quite normal, to the extent that some people choose Godparents without religious consideration but I can't get my head around that.
Sorry for the essay but help?!