S.,
You've already gotten some good input, but I'll tell you our experience, too. When my husband and I got married, I had a one year old basset hound and he had a seven year old golden retriever. Both our dogs were spoiled rotten and were our babies. We immediately got pregnant, so NONE of us had much time to adjust to our new lives together before there was a baby on the scene. However, it has worked beautifully.
Our oldest girl is now 5 and we also have a 2 year old. Both our dogs and both our girls had to learn boundaries with each other. The golden was easier, because they are mostly easy-going, but my basset was a little touchier. He especially did not like anyone (including me) touching him on his lower flanks (long story; we've worked with the vet on this!). There were several instances where, right in front of me, my little one would reach out and touch him in a way he didn't like. He would snarl and move away quickly. It scared all of us! But I decided to immediately get on to him, and then get on to my daughter. I came down a little hard (verbally) on both of them, to scare them and make the point - "you" can't touch the dog, and " you" can't bark at the baby. They both got it quickly! We had to train the next child the same way. I still tell the girls that they have to be careful around this dog. He is a sweetheart and is actually very protective of them, and he has never done anything aggressive towards them. But he is skittish in some ways, for some reason, so we have to respect that.
I also tell my girls and any child who visits that you can never trust a dog. I love dogs, but I know even the best ones can suddenly feel threatened and hurt someone, thinking it is in self-defense.
So that's a long story to say, you most likely will not have to get rid of your first baby! LOL (meaning the dog, of course!) But you have to do some strict, quick training of both baby and dog, and of course, never leave a baby alone in the room with a dog.
I'll just add that we had a very odd repairman come to our house when my first child was about 18 months old. The basset took an immediate dislike to him (always a bad sign), and when the man tried to hand his bill to me, as I was sitting on the floor playing with the baby, my dog went crazy! He barked wildly and inserted his body in between the man and my baby. He was NOT going to let that "bad" man get anywhere near the baby!! He has shown a lot of protectiveness with both our children. He's actually a huge coward, but he has a big bark and a big heart!
Duncan is just trying to find his place in the line-up now, so just give him as much attention as you can spare (hard with a baby!) but make sure he knows he can't bark or growl at the baby. Good luck and God bless!