Well E and I had a go today, very successful.
She made a treasure box today which actually didn't have enough felt around so is now a purse. Instructions here. http://kneek.wordpress.com/2007/02/05/return-to-felting/.
Found some good instructions on youtube but everyone seems to make it differently.
I have this book from the library which is great and has some good ideas in here
I have also bought some silk to print on so might add some photos to some felt for christmas decorations.
How cool is it to be able to do all this stuff as I am on maternity leave