Perhaps this story will help you come up with your own solution. My DD approached me with her hand tied quilt made by my grandmother...it was a very simple flannel quilt made with squares, no batting and a flannel backing. It showed years of treasured wear and tear from the time she got it as a very little girl. She also took it to college and used it as a "TV quilt." Some seams had come apart and some squares were literally in shreds. The backing was very thin and tattered.
I purchased a flannel fabric with a wintery forest print, loaded it on my midarm frame, put down a very soft batting, gently put the tattered quilt on the backing, arranged the pieces together as well as I could, and layered the softest tulle on top of it. Small meandering was done through all the layers before I bound the quilt with the same flannel as the backing. This way, the sweet character of the quilt was preserved on the front. My daughter continues to treasure the quilt. It was a labor of love to remember the loving connection between my grandmother and my daughter.
As a footnote, my son also had a quilt from my grandmother and he asked me to fix it, too, smile. It was worn a little differently, and I was able to repair the squares, put the quilt on a new backing and quilt it. It continues to be a treasure, too.