you can macrame a freinship braclet out of emboidery floss , they are all the rage right now.
You can hot glue a bow and some jingle bells to a hair clip. (you can even make jingle bell clips for shoes- fun!)
You can stuff a coffee mug with mini marshmallows in one ziploc bag, and hot coca in another ziploc bag- if you want to make it special go to walmart with a photo and they will put in on a mug for you, they run about 10 bucks I think.
Get an old frame and have her glue bright buttons and beads all the way around- put a pic inside of them both together, include a heartfelt note. One year we made 2 x 3 inch 'frames' out of salt dough, painted them gold, glued a photo to the back of them, covered that with a peice of felt cut to size. then hot glued a string of gold pearls around the front of the frame. They were so cute! stick a wire loop in the top before you bake it so it can hang on the tree!
She can sew up a small stuffed animal- im sure you can find a super easy pattern online. I've seen the cutest toys made out of old socks! I think they are called weird sock dolls. Look online. Our library had books of how to make them, they are like little monsters, ...SO CUTE! But we never got around to making them darn it..
A HUGE choc chip cookie with the child's name on it.
For adults, cover a juice can with just about anything to make a pencil holder.
Go to the library and pull some craft books in the kids section. lots of ideas!
Tiny photo scrapbooks are fun to make they probably have the kits in craft stores.
Have her write a fun little story (maybe she is the star?) and draw colored pictures for it and have it published into inexpensive books for people (Lookup online publishers)
Photo calendars are also awesome (walmart, etc)
Bookmarks made out of felt or large ribbon...
Gingerbread houses: Take pint size milk cartons, wash them, then cover them in royal icing and stick candy on them. (i like to cut open doors and windows). add little mothers brand pachaged gingerbread people cookies or marshmallow trees.I like to stick them on a 7X 7 peice of foil covered cardboard- make a path too!!!! I make a little sign near the front of the path with the family's name on it.....if there are 5 people, 5 gingerbread men are in the scene.
Paper garlands are fun, make them int he shape of a string of gingerbread men by accordion folding light brown construction paper and then cutting out the shape, (look at a cookie cutter) making sure you leave the hands and feet to touch the edge of each fold so that when you unfold them it is a garland of men. Put photos of loved ones in the face area. this can be cute with soldiers too, or angels, etc......
Grocery stores sometimes do beautiful colored holiday scenes on their paper sacks. Couple yeara ago Raleys did red and green poinsettas. I traced the shape of a large stocking where the design was, then traced a second shape onto a blank side. Cut out the two shapes, hold them together- then get a hole punch and punch holes every inch all the way around the side and bottom. "sew" it up with red curling ribbon. Stuff it with goodies!, cute and practically free!!! You can use glitter pens on the front to outline the flowers. Gum, pencils, keychains, hair clips, gift cards, candy, magic gloves, all work inside....
Put a cup of chocolate covered raisins in a baggie, tie it off with ribbon, with a note " reindeer poop". In fact, put this in your stocking!
Ideas for grownups to do: make a family cookbook, put a photo of the person on the facing page of the recipe with a little family story.