A lot of people have mixed views regarding used items. I for one have no issues accepting anything used. It has saved me so much money in my time as a mom. Heck, even before becoming pregnant I was okay with used items. In high school I actually thought it was an adventure going to Deseret Industries and finding awesome clothes at so low prices. It was fun.
When I was pregnant with my daughter, I got a huge bag of maternity clothes from an awesome lady in our ward who was done having babies, and it helped out so much. They were all in good condition, and when I was through with them, I gave them to another friend of mine when she got pregnant. The joys of passing on ;)
Another friend gave me all the outgrown clothes from her baby girl when they came in town. I was so happy. It saved so much money. Another friend had been given a cradle but already had one, so she sent it my way. (Which I passed on to another friend who was to have a baby when my daughter was a year and a half and it was just taking up room.) My daughter's crib came from a yard sale that a friend found for only $10. She called me and asked if I wanted it and she brought it on over. It was a Jenny lind crib in great condition. That same friend found a box of baby clothes at yard sales and gave them to me. When it came to my baby shower with my daughter, I didn't register anywhere for gifts. When people asked what I needed, I told them diapers would be helpful and surely we received lots of diapers, in addition to other clothes and other awesome things. I also bought baby clothes at Deseret Industries that were in great condition (at the time I was working there, employees received a 25 percent discount, which really added up). My daughter's blessing gown came from her Nanna (my mom) in Europe. My mom also sent a parcel with blankets and a few cute baby items. Other things were received from friends and family. I did buy a few things, but it really saves a lot when you accept lightly used things for your baby. Also, the things received at the baby shower helped a lot.
With my son I did register and was truly showered with gifts. I had given away the crib to someone who thought they would be having babies soon and other things. A friend offered her crib, because she was done having kids. I borrowed a bassinnet from another friend since it would only be used for a couple months (which in turn we found out she was pregnant so she would need it back shortly, which worked out perfectly). As for clothes another friend offered outgrown clothes, and I looked through my baby girl clothes to see if any would be fine for baby boy, which a lot of them were. I needed a double stroller so both kids could be pushed if needed and looked on Craigslist and found one listed at $20. When I went to look at it, it wasn't in bad condition. The lady just wanted it gone and offered to let me have it for $10 if I took it right then, and surely I handed her the cash and walked away. The car seat was given by my manager at the time, whose wife was so excited to buy for a baby since her kids are all grown and it looks like years til they have grandbabies.
Over all I think it can be pretty inexpensive to clothe and provide bedding for a baby. You just have to be open to lightly used items. My kids and perfectly healthy and fine. It didn't hurt them any by having used items.