Gal, the rugs are crocheted. My mom use to cut up our old clothes and crochet rugs. I have a crocheted rug in the one bathroom. I would have more but my daughter sneaks them out of the house because she likes them. I've seen them with a the raw edges folded inside, but I just crochet them with the edges raw. They wash up fine.
I don'y make the rugs like you posted, I bought a used hook, cutter and have the backing but I haven't tried one yet. Can I email you when I start?