My grandmother made lots of dolls. Rag dolls, baby doll dresses, stuffed patchwork turtles. She got some ideas from a book that she later gave me, but she could make anything she could see a picture of.
One of the dolls she taught me to make at a young age was a yarn doll. You take scrap yarn, and wrap it many times around a small book. Then you slip that yarn off, and tie it in strategic places to make the head, body, etc. Great tutorial here.
Don’t buy yarn for this making activity. If you ask your community for yarn donations, you’ll be inundated with leftovers and projects crafters never started.
Once they learn the basics, see if your students can make other animal dolls from yarn!