I have some of Knitpick's yarn -- I've liked it. It's nice to be able to get real, actual wool for the same price as on-sale acrylic from Joann's.
I also have all the things I need for Kool-Aid dyeing. I got them for 25 cents each, which I think it's quite fun and cheap for custom colors! Plus it doesn't involve all the crazy chemicals and such like the commerical dyes...
My current projects right now all involve alterations/re-creating. I've discovered over time that unlike my mother, I actually don't like doing craft stuff "from scratch" -- I get too overwhelmed. (Like: if my mother helps me cut out a pattern, I will absolutely see the sewing through to completion. Ask me to do it all myself, and suddenly I drag... and drag... and drag.) So my current thing is going to thrift stores (and on eBay) and finding things I can redo/remake. Just last week I was considering buying a size 3x sweater that was a really soft acrylic/wool/mohair blend... it was in complete pieces (not cut on the seams), so for $4.50, that would have been a steal on the yarn! And one frogging experience that would actually bring delight, as opposed to frustrated tears....
Right now I'm ripping out the seam on a silk dress to salvage the skirt (I'm planning on adjusting the zipper on the top and selling it back on eBay, which is where I got the dress -- the top's fully beaded and quite pretty, but it just doesn't fit me) to make part of a costume/competition outfit for my ballroom dancing hobby. I've done this before to make practice clothes... a lot of the old 80s formal dresses had full circle skirts, and I'm terrible at sewing with chiffon/slippery fabrics... so I consider it quite a deal to spend a few hours ripping out seams and adding waistbands to get a skirt for $5-10, depending on the type of material. :)
I've got a drawer of items to re-do... I'm trying to be good and not buy anything else to add to the pile until I clear it out!
Actually, Pat, I was wondering -- do we have a thread where people can post pictures of their accomplishments? I think it'd be fun to see what thrifty crafters come up with. A lot of times I feel out of place among the other crafters I know, because they just go out and buy their materials new/not on sale...