Here's a couple of felt crafts that your kids might enjoy, or maybe even you might want to try
Hankie Holder-- Cut a 6 1/4 x 4 3/4 inch rectangle of felt with pinking shears;fold in edges to meet at center. Sew ends with a running stitch. Back stitch an initial on a cutout heart;apply with fabric glue.
Felt Pencil Case-- To make a pencil case cut a 2 1/2 x 18 inch rectangle of felt;fold up bottom 6 inches. To sew, use embroidery thread and a needle with a large eye. Stitch up the sides with a running stitch;Finish with a knot in the back. Fold over flap;add a button and snip a buttonhole.