I was taught in my college child development classes that open-ended art projects are the best...this means projects where the children can show their own little personalities, projects as wild or as gentle as suits them, projects where the parent or teacher stands back and assists only when necessary...I really loved this idea and one Christmas, years ago, copied all the open-ended crafts from an old craft book, put them together in a little, colorful booklet and gave them to my mom to use with my four younger siblings.
Another crafty thing I love is using recycled materials...have friends or parents you know save their cardboard tubes and boxes, old magazines, etc. I love re-purposing old things!
Most importantly with crafting, as with most anything, it is the process that is much more important that the product...if their little creative juices are flowing and they are laughing deep belly laughs in the production of their craft, that is what is best!