They didn't skip Eta, which is a common enough name if Xi is, especially given that Xi is pronounced ksʌɪ and, if we're focusing on Chinese (does it exist as a name elsewhere?) it's not going to be romanised and a child in grade school won't be aware anyway.

I'm not buying it. I know 3 of these: https://en.wikipedia.org/wiki/Corona_(surname)

The popularity of the name Katrina was relatively stable in the 200-300 most popular range until Hurricane Katrina hit, at which point it declined into the 900s.

I think they would survive. If a kid gets picked on for their last name sounding the same as a Covid variant, they were probably going to get picked on for something anyway.

Bending over backwards to avoid offending people isn't good policy, because it just lowers the bar for what makes people offended.