How about a cute wall hanging that he/she can enjoy at age 6,7,8. Puppies, farm animals, scenery.

How about a mini quilt for the baby to drag around with him or her when crawling, walking, riding, and sleeping...a security blankie!

Crib sheets, burp pads, bibs.

My daughter had twins 2 1/2 years ago. I made each of them one of the fleece throws that you tie the edges in a fringe. I used 1/2 yard length. They will not sleep without these throws! They are soft and cuddly and easy to carry around.
Carol B

Lots of great ideas - thanks heaps.

Bumper pads, wall hangings, curtains, burp clothes. Have fun grandma.

I found the cutest pattern by Pearl Louise designs. It is a quilt with a hood. You can get patterns to make them look like different animals, lion, frog etc. She has designed the cutest fabrics to make them with. I made the lion one for my first DGS last fall.

You can get the information on line at the The Thimble Cottage.com

I have made nursing mom's cover-ups...also known as hooter-hiders. VERY easy -- the pattern is online.

I also have made diaper bags (in the Vera Bradley style -- are you familiar with that?) with coordinating changing pads.

Also bibs with a little velcro-closed thingie at the bottom to attach a binkie (pacifier). (sorry, not sure if you're familiar with these slang terms).

I made a ton of these burp cloths (http://www.vanillajoy.com/burp-cloth-tutorial.html) with fabric that matched the theme I was doing for my daughter. It was great fun because my mom and I collected some really neat flannels & had a ton of fun doing this really easy project!

Wow, lots of great info. Thanks everyone.

I looked up all the links (heaps of easy to do bib type stuff) and googled Vera Bradley and hadn't heard of hooter-hiders.

Loved all the cute hoodies GrammaNan.