E.,
Most everyone has responded that you should just let your baby cry it out. Ultimately, it is your decision, of course, but let me put out a different perspective, so at least you aren't making the decision from unfounded fears of somehow harming your baby or having a teenager still sleeping with you!
There are societies where children have slept with parents until the child chooses to move. There are very few societies, including Westernized societies, where it is considered "normal" to place an infant in a crib in a room alone. Pediatricians, while they are necessary and excellent at providing help with making decisions about a baby's medical needs, tend to give parenting advice that comes from doctors, not mothers. In honor of Mother's Day, I'm going to say "Mother knows best" on this one.
Go with your instinct. If you and your baby are more comfortable sleeping together, or if it is neutral for you and more peaceful for your baby, consider letting that continue. If you are breastfeeding, it is certainly a thousand times easier and better for your sleep to have your baby right there where you can just pop it in her mouth and basically go right back to sleep. You'll get very proficient at that if you aren't laying there worrying. You will NOT suffocate your baby! That is a ridiculous assumption that people put on others to scare them--unless you go to bed literally "dead drunk" you will wake up or stir the second she does and you will simply not end up laying on your baby. Just try sleeping with a cat--you never end up on top, do you? In fact the cat keeps you from rolling over half the time! She should not, of course, be using a pillow. There is actually some evidence that SIDS could be prevented by the natural harmonization of the baby's breathing with the mother's--proving that it is actually a physiological reality that it is natural to co-sleep. As far as her falling off the bed--it's more likely she will snuggle up very close to you, because you are warm and it is NORMAL for her to do so. But if you are really concerned, or you have a very small bed, put a twin mattress on the floor next to you. She won't hurt herself even if she did fall out, frankly, as long as there is a rug there. Babies really do bounce! ;)
With my first daughter--18 years ago--I tried putting her in a crib in her own room at just about exactly 6 months old. She was so upset it broke my heart. She did not cry it out and eventually go to sleep, she cried hard--the "scared" cry--and cried more the longer I tried to wait. After about an hour, I went in and got her. The next night, I tried again--because that was what the pediatrician told me I "had" to do. She eventually did wear herself out, but she was still "hitching" in her sleep when I went in to her the next morning. That was it. She was never forced to sleep alone again until she was ready. We kept the crib in her room, she had her play area there, too. Eventually, when she had words and could understand mine, I talked with her about putting her to bed in her own bed, then I would get her to sleep with me when we went to bed. I built up her trust with that-kept my promise. Within a few months, she said she was ready for a "big girl" bed. We bought a handmade bunk bed, and decorated the bottom bunk all special for her, and most nights she slept there. Once in awhile, she woke up and wanted to come in with us--and that door remained open as long as she needed it. But for the most part, being responsive to her needs and feelings even though she couldn't talk, while gradually moving her to her own bed once she could, gave us both that trust and closeness, while giving her great independence as soon as SHE felt ready for it. (And it certainly did result in an independent person--she's now in her second year in college at age 18, and running for student body president, lobbying the U.S. Senate for better college funding.)
My second daughter is now 14. She was an absolute snuggle bug until she was about 1 year old. Her older sister came and joined us on a mattress on the floor when she was newborn--just because she wanted to be part of the whole family. That didn't last long--big sis went back to her own room after about a week or two. At about 1 year old, daughter number 2 started literally crawling across my face as she slept--tiny toenails scratching as they went! She quickly went into her own crib--which we put under big sis's top bunk-removing the bottom bunk to put the crib perpendicular under it. Made it a big event for big sis to move up--and since little sis was totally in love with big sis, she was ok with it too. But I still ended up with her in bed with us once a night to nurse. (yes, I also believe in nursing well into toddlerhood)
Third daughter was born when second one was 6 and already had her own room. Third daughter slept with us in a very large, king size bed we had--and with her being my last baby, I was in no hurry to end this arrangement. It's warm, it works well for feeding, she slept better and so did I. She also just happened to have a very sensitive personality and cried a lot--having her in bed with us was probably the only way to get any sleep at all, frankly. She slept with us until she was about 1 or so, and we put her in the bottom of her big sister's bunk bed (one of those metal ones with a double bed on the bottom) gradually--but totally allowed her to sleep with us whenever she wanted to. She chose the family bed about half the time and sleeping with her sister the other half. She now sleeps in her own room, too.
Let me reassure you again--NONE of my daughters insisted on sleeping in our bed later than about 1-2, and by that age, though they frequently chose to for a couple more years, it was only because it was just fine with me and my partner--if we ever said "no", that was ok, too, because we could give a reason (like I'm not feeling well, or I just want some "Mommy Daddy Time" tonight).
By the way, they did not get in the way of adult snuggling and more. Babies who are happily ensconced near Momma sleep very soundly--even if you scoot them over a little bit. You get to know their patterns and when they might be starting to stir.
Good luck with your choices,
Fiora