In my quilt group one pattern is chosen. Everyone uses the same pattern. The number of blocks needed depends on the size of the block and the number of participants. If participants want more blocks it is up to them to make more. With a group of your size you may need to require each participant to make 3, blocks or 4 blocks.
Some times we have color suggestions some times not. This year we are encourage to make our blocks in colors that reflect our favorite colors.
Another group I am aware of that is small (less than 10 ) that has participants choose the own colors. They put a prescribed amount of each fabric of their choice in a grocery bag. The bags are then passed through the group and each participant makes a block using the fabrics in the bag. The original owner of the bag then finished he quilt using the blocks provided by her or may be his friends. They have also done this in a round-robin format.