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The only times I've ever come across it is as a diminutive for a host of names... although I do also have several friends who were given it as their full name. A great great aunt of mine who recently died at over 90 was known as Molly although her real name was Mary Maude. I've seen it used as a diminutive for Margaret as well, but as far as I know it's the diminutive of Mary.
This is all that I know about it, but I'd be interested to know if it does have roots in Sanskrit.