Quilters Dream makes a cotton batting specifically for hand quilting. It's called Request. Go to this link to read about it. There are several places online that carry it. If you can't get it online PM me and I can order from the company and ship it to you.
http://www.quiltersdreambatting.com/dream-cotton.htm. You could echo quilt around the appliqué then do a design in the sashings and cornerstones.