Making a beanbag or heat pad toy, you can gear up the finished article to suite their ages
You need
fabric crayons or pens (crayons best at 4 as less likely to get onto clothes)
White cloth - more cotton than polyester - 50/50 at least
stuffing - barley is cheap if you want to make it into a heat pad - otherwise lentils or any other stuffing - even chopped up poly bags make good stuffing
Sewing machine or needle & thread - you will probably have to do this bit, at least for the 4 yr old - 7 yr old might be able to sew their own :)
Get the kids to decide on what they want to make -
for example at 4 DD made a ladybird, so I cut out a pair of ovals in the fabric, an inch bigger all round than we wanted it ti finish - this allows for stuffing to pad it out & make it smaller.
DD then used the crayons to draw & colour the shape into a ladybird - the underside fabric she just coloured in black - we used the internet to look at pictures of ladybirds top & undersides for inspiration, which she loved
once she'd finish, I ironed the cloth to seal in the fabric dye & helped her sew the 2 ovals together - leaving a hole - we used a funnel (make one out of card or toilet roll inner if you don't have one)
DD then poured barley into her ladybird until it was full - I sewed up the hole for her
She still uses it today for tummy pains etc :)
you can do all sorts of simple shapes, cars, trucks, doll, butterfly, cat dog - anything they can think of :)