I like Micron Pigma pens. They come in several different colors and tip sizes. After you heat set them they are permanent.
One thing to keep in mind is that fabric is not like paper. The fabric wants to move so you have to write slower and more carefully. And people who don't work with fabric don't know that. So you may want to have an extra piece that they can 'practice' on before writing on the actual wallhanging.
Your friend is lucky to have someone like you to make her such a neat keepsake!