PaperPrincess, I think the reason that the embroidery palce that you mentioned stitches out on Felt, Is strictly for the purpose of showing the embroidery designs and not to use as garments or quilts. If it's not to be washed, felt will work...I use it to test stitch my embroideries as well.
What you need for a stabliizer under embroidery is a fusible , wash-away, tear-away or a permanent stabilized (such as a no- show mesh) depending on the fabric you are using you may need more than one layer or you may need heavier or lighter weight stabilizers. If you go to an embroidery web site, such as "Embroidery Library" and go to their informational pages/tutorial pages and look for stabilizers, they will have a chart of the different ones to use for whatever you are trying to stitch out on.
Hope this helps.