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I wouldn't think twice if someone who wasn't Arabic used the name. The first person I think of when I hear the name is Farrah Fawcett who wasn't Arabic. Plus, it's close enough to names that are familiar in English, such as Sarah, Clara, and Cara, so I don't think that using Farrah/Farah would be all that problematic. My guess is that most people in English-speaking countries aren't even aware of Farrah's Arabic roots.

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I'm used to seeing Farrah, but I think I prefer Farah. The additional "r" looks a bit superfluous to me. With that said, people might be more apt to spell it Farrah due to Farrah Fawcett, so going with Farrah might be the better choice.

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I would expect to see something more popular paired with Jacqueline or something less popular paired with Farrah, but sibling names don't have to match perfectly, so I'd say that Farrah and Jacqueline work as sister names.