In the northern US at the local craft fairs i always look for mittens and hats made of the felted wool. There are usually several ladies who make them and they are warm as well as cute. I haven't tried it but it would seem that if they are really well felted they wouldn't ravel so you could embroider nice designs on them and cut to placemat or coaster size.

they would make good pet beds, maybe add the pets name

You may be able to make a wonderful coat that is wind and water proof with the large felted blankets. I am not sure how heavy it would be -- but I know the mittens and hats are perfect for cold winters where I live.

Some very good ideas below! Here's a few more:
If the fabric is not too thick, you might be able to use it for making some microwavable hand warmers, like the ones at Embroidery Library. They have a tutorial for making them & they last a long time.
If it is 100% wool, you can use it to make a pad for your ironing board or pressing table. Great for steaming pressing!
If you make your own slippers, you can use it to pad the soles for added warmth and comfort in tbe winter.

Let us know what you decide.

Could you use it instead of Batting? Make an embroidered patchwork quilt as a piece of fabric and join a back on it like a pillow case effect them put blanket inside and attach around the edges? Would be good for snuggling into on the lounge on a cold night.

Oh, my , you have some great suggestions. Go with them!!

As you said they were cream then you also could cut out flower shapes to layer to create flowers with a button at the center and since they are cream you could dye the layers of the flower the various shades you are envisioning. This would also be so cute making an embroidered table mat with accents of the layered flowers adding the 3d texture- or creating cute tote bags with the embroidery and layered flowers. So many options I know you will figure out something wonderful to do with that great find. Hope you share some pictures with us when you decide. Pam

You can wash and DRY them to get them to felt more (maybe drying can get them even thicker). Not sure how hefty the felt is, but here's a tutorial for a felt basket from Stickbaer. Cream wool means they can be easily dyed any color you like - natural fabrics take all kinds of dye. I'd saved some wool jackets to felt and make rustic Christmas stockings with. Also, if they are thick enough, many folks on Etsy sell felted wool phpne holder, laptop cases and iPod case