You mean the baby's own sibling? If they're sufficiently older than the baby, I think it is LOVELY. I have four siblings who are much younger than me. I was not the official godparent of any of them but certainly took on that role - kind of like a parent figure, but not a parent figure, just someone older and allegedly wiser (okay, well, I tried!) to help guide them in life with a perspective distinct from the actual parent's. I would have been honored to have this role made official by the godparent title.
As for your own siblings, I think that's done constantly - not unusual at all.