Does anyone know where I can order cotton fabric that has
Kai-lan on it? Kai-lan is a Nick Jr cartoon character.

Sorry, never heard of 'em.

Hancocks and JoAnnes both had it, but a while ago, I think
You might try an eBay search.

Found poly fleece at Hancocks online:
http://www.hancockfabrics.com/Ni-Hao...VVviewprod.htm

and there seem to be sheet sets available at Amazon, Walmart, Target, etc.:
http://www.walmart.com/ip/Baby-Boom-...i_sku=15127176