Oh what a bummer, but I do understand. I have had issues with clowns as long as I can remember and I don't know why either. It's weird.
It helps to decide where you want the blankets/pillowcases to go and then contact the source and ask what the need is. I almost exclusively make stuff for teenagers since most of the stuff is geared more towards younger children. I'll have to check about pillowcases. Those are fun to make. I haven't tried one with the piping though. I'll give that a shot on a pillow for me.
Some of the local hospitals will no longer accept homemade toys, which is unfortunate. They claim it is because of infection control, but one nurse said it is simply the politics of one or two people since anything autoclavable with no loose parts such as googly eyes is certainly acceptable.
Yes, people do appreciate charity quilts. I was finishing the binding on one to go to the children's hospital while at a laundromat and the guy that came in to fix one of the machines thanked me for making them. His son was given a quilt in Baltimore while being treated for cancer and although he died, they still have the quilt and it really has helped deal with his loss.