Is the flag washable?? That would be my first question. I was just looking at fabric and there are fabric made with the Marine Corps symbol printed on cotton fabric. Here are some for sale on eBay.
http://www.ebay.com/sch/Crafts-/1433...e+Corps+fabric
Anything patriotic, I am sure the guy would be so honored with you making him a quilt for his service. If I can be any further assistance, don't hesitate to PM me. My dad served in the Marine Corps during WWII.