I agree with the baby or lap quilt sizes. People are much more likely to splurge on a small quilt, than a bed-sized one. Since baby quilts/blankets are so easy to find, make yours extra special.
Generic 'I Spy' baby/lap-sized quilts would probably get some attention . . . but don't make them too 'babyish' because babies grow quickly! Think more toddler/young child pictures, in bright colors.
Another idea - Shabby Chic baby/lap quilts. I've known fellow-grandmas/great-grandmas of baby girls, who'd have snatched up something like that, in a heartbeat. Avoid baby prints and go for delicate florals, soft colors, with scalloped borders. Some of these could also be appropriate for elderly ladies, in nursing homes.
You might also try a few walker or wheelchair bags.