a local quilt guild has a kids day each year. they have lots of precut 5" or 6" squares of fabric and the kids get to choose 9 of them and put them in the order they like. then someone from the guild sews them together and adds a backing to make a quick small quilt. (use the birthing method)
for recycle you could just cut up old shirts and use old sheets or pillow cases for the backing. really don't need batting. or, they could be stuffed and become pillows instead of blankies.
of course you might need extra sewers. i am sure there are parents who would help.