This is an age old problem. before becoming a full time maker I was a mechanic, after a 16 hour day the last thing I wanted to do when I got home was work on a car. I find friends more expeting than family. I usually make at least one family member a knife for Christmas each year. When friends ask about a knife I find this works. "Why don't you come by the shop, we'll draw up something , you can pick out your handle material and I'll give you a price. They seldom show.
DonL, I did the same as you in the beginning. I couldn't beleive someone wanted a knife I made. most of the time I would sell a knife for what materials cost to make it. As demand increases the loss becomes greater. Also when it's your livelyhood free is not an option. As Ed said, seperate friens and family. Or you'll be spending hours repairing Flee-Market knives with materials that cost more than the knife is worth. For the friend of a friend.