That sounds like a much more doable option, much more comfortable. You sound a lot more comfortable with this idea.
And, you have the benefit of immediate gratification! You get your dog right away!
It's way easier to have a one year old dog than a new puppy. A year old dog, even a cavalier, doesn't need the amount of attention that a puppy does. Puppies need it both for emotional and social reasons. A year old dog (when the baby is born) is a whole different ball game. Of course they need lots of love, but their needs are not as urgent and are more flexible.
Another positive thing about getting a 6 mo. to 1 year old dog is that you will pretty much know what's going on health-wise, whereas with a new puppy, things aren't as clear or stable. Since Libby/Livy has been with her breeder her whole life, with the same vet, on the same food, you have more of a health history than if you'd gotten a puppy. You might want to look into dog health insurance, or a savings account just for health care reasons, that could relieve some of your anxiety about potential expenses that could hit you unexpectedly.
Libby/Livvy will need lots and lots of support in adjusting to the move to a new home. I'm quite sure dogs experience grief from loss of social bonds, both with other animals and humans. If she loves other dogs, hopefully you can find opportunities for her to play with other dogs.
It sounds like a plus that she is used to having her person be out of the home during the day, since you both work. Hopefully one of you at least could come home and play with her mid day, especially if she's used to other animals being with her during the day. My daughter/bf got a cat for their cavalier Belle and they say this has greatly helped, Belle and the cat love each other and play and sleep next to each other. They're not able to come home during the day.
If you become comfortable with this option, explore all your doubts and answer all your questions in ways that you feel reassured, it sounds wonderful! Some of the things that would've made me most reluctant to get a dog when my daughter was a baby are eliminated by the dog being a year old by the time the baby comes. Has she been spayed? you would want to get that out of the way, if she hasn't.