Wow- how cool is this! I think I may try this with a group of kids- making an area rug with fabric scraps! Remember the old fashion rugs your great grandmother had- or ones you see in a cozy cottage? Well You can make your own area rug just like it.
This site has quite a bit of information on making your own braided area rug:
This site has still more ideas- area rugs and a bath mat made from old maternity clothes:)
Books on Making Your Own Braided Rugs and Area Rugs: