I would have each student bring in at least one piece of cotton clothing no longer wanted (depends on size of class - you might have to add to this if you don't get enough).
Teach the kids to sew them together (or you do it while they watch), add batting, backing and binding. When all done, donate the quilt to the local hospital.
You now have taught the kids more than one important lesson.
You have shown them recycling, quilting and donating.