I was fortunate enough to be present one evening at a friend's house (only about 1 month after I learned to knit) to help teach an 8 year old to knit. I have attempted to teach Simon (my 5 year old) to crochet and each time it has ended in tears so maybe 8 is a better age to teach such things.
Alice picked it up right away. She was patient and really focused and I feel really lucky that I got to teach her. Her Mama was teaching her 8 year old friend that was spending the night - and it just so happened that I got to help Alice. It was really fun and super pleasing to leave their house that night knowing that she had it (we just did knitting no purling quite yet). She was pretty into it also. The next day (or maybe two days later) when I saw her she had made some serious progress on a project. I lent her my giant size 15 needles and some variegated acrylic yarn I had in my closet and she was proud to show what she'd accomplished. I will definitely be teaching my kids to knit (when they are a little bit older).
A project I'd just completed that I happened to have with me (to show Alice) was this checkerboard scarf. It is almost the same thing that I made for Nicole (posted a couple of days ago). I just used some variegated acrylic yarn I had on hand. This is a close up of the checkered detail. And a photo of how I like to "wrap" a scarf as a gift. It is so pretty just by itself so why not take some of your tail (leftover from casting on) and tie it in a bow around your creation?