I was in this situation jsut a couple weeks ago. I have one sister who is very religous, but very NOT Catholic. She is Protestant in the worst form. Even though she loves God, she does not respect our faith, therefore, she is not a godparent.
My DH has one brother, who although is a cradle Catholic, that is the extent of his faith - birth. His actions do not portray that of someone I wish my kids to see a role model in.
We chose friends to be our kids godparents - and we have 3 kids - so that’s 6 godparents! Two of them are not Catholic, but are not anti-Catholic, and DO respect our teachings.
The worst of those to “break the news” to was my MIL. She is so family oriented, that her view is a bit skewed when it comes to the real reasons for things (such as choosing a GOOD godparent). We just simply told them that we chose people who were already a role model for my children, who resepected our faith, and who chose to own up to the responsibility of being a godparent (such as going to church every Sunday, making sure the kids pray before meals when we are with them, etc). Even though there were comments made and such, we said nothing more and held our ground.
The important thing is that the kids get baptized.