I would do exactly as you first suggested. Sounds like a great, original idea to me. My next question would be why do YOU have to quilt it? You and your daughter can have the fun of taking the pants apart at the side seams and appliqueing them to the fabric that you and she decide on. Since we've already established the pants are washable we want to make sure the whole thing can be washed so, I would find someone who will quilt it for you. Good Luck!