as an art teacher i did alot of crayon transfers to muslin with the kids. these are washable - however i never did quilt with them but see no reason why not.
using regular crayola crayons, make a design on coarse grit sandpaper. the design should be shape oriented, that is, not alot of detail. the sandpaper is just about right size for a block. if the design has a border around it, that works well for a block. Designs are most effective if every inch of space on the sandpaper is colored and heavily so. if there is thick enough crayon you will get a very colorful transfer on the fabric. lay the muslin or any cotton on top of the sandpaper and iron on high. you can use a press cloth to avoid getting crayon smears. it will smoke as it burns off the wax so do this in a ventilated room and with adult supervision.
have fun! :)