I love this idea of a great kid-friendly Xmas decoration from Country Living. I remember having years where our tree was decorated solely with handmade ornaments.
My kids may be all grown now (though not all moved out!) but I have a whole new group of experiences with grandchildren to bake and make crafts with.
I think these are a very quick (in case your little ones have short attention spans) and easy craft to make. If you have pre-cut the felt squares (colours of your choosing) they will come along readily for you!