As to the economy slumping... I don't think it makes one bit of difference once you have developed your reputation.
Before I became physically handicapped, I made a living teaching people to do something that is essentially a hobby. I charged $125/hour and had more business than I could handle.
Over six years post-disability, I am *still* getting requests and pleas, both from former students and from people who heard of me or bought my books to do "just one more lesson, PLEEEEEEEAAAAASSSSE!!!!!"
I haven't done any advertising, I have tried to make it as clear as possible that I am no longer physically able to do it, period, full stop. And yet, even in this bad economy, I have had requests for lessons from people who live 2000 miles away, who are prepared to travel all that way for a couple days of lessons (in which case I think the cost of lessons would be the cheapest part of the trip!). And while I love where I live, it is no vacation destination type of spot.
If you provide high quality, you don't have to convince anyone to buy. All you have to do is show that your high quality work or product exists and people will want it. In the specific case of quilting, it means providing lots of samples to give away (in the form of quilted mug rugs, maybe?), attending every group and guild within reasonable travel distance, making the rounds of every quilt store within a reasonable distance (and leaving not only your cards but a sample of your quilting), donate quilts to be raffled (with a minimum price required) and maybe even entering competitions.
Well, find a copy of _Guerilla Marketing_ and you'll get a plethora of ideas.
Think on a national or international scale. Set up a web page, learn to take good photos or pay a professional who specialises in photographing textiles. Set your prices to reflect the quality of your work.