Let me throw my two cents into this discussion:
1) It seems fairly established that mainstream Jews in the first century have, for the most part, discontinued the quotidian uttering of the name of god, because of religious superstition. It doesn't mean, though, that the utterance of the name would cause scandal, especially from the mouth of a teacher.
2) It wouldn't be a surprise if the gallilleans on the north used an aramaic or greek variation of the divine name, that would differ from the hebrew.
3) Around the first century, certain radical, fundamentalist sects became hell bent in restoring what they considered to be the "pure" form of judaism. One of those was the ascetic group we know as the Qumran Community of the Essenes - yes those who have produced the manuscripts that we know as the Dead Sea Scrolls.
4) Certain authors, such as Robert Eisenman (see James, The Brother of Jesus) make a good case in establishing a connection between John The Baptizer and the Qumran Community. John was at least influenced by this community, maybe even at some point was a member of it. Jesus started his spiritual journey as a disciple of John.
5) As attested by fragments found among the Dead Sea Scrolls, the Qumran Community appears to have used the divine name in a much higher scale than their contemporary fellow Jews. It is possible that their beliefs aiming at the restoration of a "pure worship" included a renewed reverence for the divine name, "restoring" its honor by using it - especially in liturgy.
6) Being this the case, it isn't hard to understand why Jesus, indirectly influenced by these ideas, would direct his disciples to pray "sanctified be thy name" or say "I have made your name manifested". It is very likely that Jesus actually uttered the divine name often (possibly in its aramaic variation) in his preaching and teaching. It would be considered an eccentricity by the mainstream Jew, but understandable coming from a radical, fundamentalist preacher such as Jesus was. Certainly, it wasn't the utterance of god's name that led to his demise: it wasn't even brought up as an issue during his trial.
7) Let's not forget that Jesus never meant to start a new religion. He advocated a new fashion of Judaism, but he didn't create "christianity". Nor did any of the twelve apostles. They were all Jews, and observed the Torah and the Jewish traditions. In the book of Acts it's clear that James, the leader of the Jerusalem congregation of Jesus' followers, was still a scrupulous observer of the Law - and he enforced it on Paul, even suggesting that the preaching of the self-styled apostle was an apostasy against Moses. (See Acts 21) The earliest followers of Jesus were entirely Jews and didn't see themselves as part of a different religion. They were merely a sect within Judaism. A sect of mostly illiterate people (only exception being perhaps Levi and Judas) who probably uttered the divine name but never put it down in written form.
8) What we have come to know as "Christianity" is essentially a Pauline invention; it is Paul who carved out a new religion loosely based on the teachings of Jesus. But in order to make that new religion palatable to the greek-roman world, he needed to distance it from its Jewish origins - judaism was poorly regarded outside Palestine or outside the jewish communities of the diaspora. That included the suppression of the divine name from the early christian writings, who are mostly penned by Paul, by Paul's disciples, or heavily edited and redacted by them.
9) The destruction of Jerusalem and its temple annihilated the original congregation and offered the dimming Pauline apostasy an opportunity to thrive. Eventually, the pauline flavor of Christ became victorious, and his disciples re-wrote the story of the movement and its gospels to suit their narratives of Jesus, and those are, for the most part, the manuscripts that survived to this day.
10) Once the divine name of the hebrew god was expunged from the "christian scriptures", it was a lot easier to conflate Jesus with God, and thus, for mainstream christianity, the preacher from Gallilee became God, and the path for the trinity was open.
