This is only important if you are breeding your sheep to sell breeding stock, rather than breeding them primarily for meat. We try to have only a max of one shared ancestor per pedigree record of parent, grandparent and great grandparent. Some times it happens that there are two, but ideally there should be none at that degree of proximity. There is line breeding but that is usually done by breeders who know their genetics and are attempting to fix a particular trait - there will be 'wastage' at that level ie where inbreeding has a negative effect, so it's risky.
As a general rule, siblings, parents and grandparents should not be bred together