You can felt wool "too much". I first wash on warm and run thru dryer. This is to get it clean and tighten it. Then I decide if it is felted enough for the project. If yes, then I take it apart. If not, I run it thru on warm or hot again.
I use a lot of wool in hooked rugs and keep all the interfaced collar and lapel pieces which are not good for rugs for applique. Got a huge collection.