We grew up in a very poor small town. What my mom did was get all the parents together, and had a lunchtime when they had all the kids draw around their hands with fabric crayons, each on a separate piece of white muslin, and had them write their names underneath, also in fabric crayon. (We were in maybe sr. Kindergarten, so about 4 or 5 years old? Crayons were the natural choice
Then she set the crayon, added sashing, and quilted it. The sashing and batting came out of her own sash, and this way none of the other parents had to pay for a gift. The teacher LOVED it - REALLY loved it. For a decade afterwards (until she died), when I saw her on the street she'd make sure to come up to me and talk about it. That being said, I don't know that that sort of thing would fly in an area that's less close-knit, or if the parents want to each do something.