It's an expression I hear quite a bit, mostly in joke -- but let's face it. Whether we want to or not -- whether we realize it or not -- we judge people and characters. And a lot of the time, one of the first impressions is actually a name.
Names are obviously important -- they need to match the character's personality, time period, social status, and so on. Eugene Fitzherbert isn't a great name for an adventure-loving thief, and I'm sure Flynn Rider would back you up on that one.
But even though names are important, they don't necessarily make or break a character -- that's all up to the characterization.
Example time --
Four from Divergent by Veronica Roth. I mean, anyone else ever read a character with a number for a name (besides the temporary title Boy 412 had in Magyk by Angie Sage)? Yeah, not really. And somehow it seems like Four makes a natural name, whereas, I don't know, the name Three or Five or Eight would just be ridiculous.
It's the same way with Dustfinger with Inkheart by Cornelia Funke. At least Four is a nickname -- Dustfinger's kind of stuck with his name. Still, he's an awesome character, and if you focus on him and don't consider his name too deeply, he manages to make "Dustfinger" a pretty cool name.
A lot of high-fantasy books are the same way. Who would've ever thought Aragorn or Frodo or Legolas could've been names?
These are only a couple of examples, but I the point's pretty clear -- any more would be overkill. Have you come across any other names that at first sounded riduculous, but ended up seeming rad once the characterization had done its job?