If you're finally in the mood to make love after giving birth, you know by now that baby is never not in the same room as you and your partner. So there's pretty much only one option: have sex with baby near by.
Is it terrible? No. Will you be the first couple to have sex with a baby asleep in the room? Definitely not. The fact is babies (especially newborns) can sleep through anything, including the sounds of sex.
But if the idea bothers you, try to be quiet and quick (this means lots of foreplay) or change your location. Experiment with having sex in other places in your home (kitchen, bathroom, closet, etc.). Keep in mind that if you are hesitant to have sex "in front" of your baby, this will translate into an inability to be turned on. You'll be less likely to become aroused, lubricated and amorous in general.
In order to avoid that situation, be upfront with your husband about your hesitation. If you just say no to sex, he may interpret that as a relationship issue, rather than one of location. Remember that the better your communication is, the better your sex life will be.