My arts and crafts projects actually are sale and gift-worthy, so don't go away too fast ;)
I have made some awesome purses from old cigar boxes that come in every shape and color. Check out my hub on green art from recyclable things. The wooden ones are perfect for making purses. You can buy handles at the crafts store or make your own from leather straps, fabric (denim is good) or beads strung on wire. I also have made amazingly cool purses from old blue jeans which you can get for $3 at the Good Will. These are great because they have built in pockets already. Sew a seam below the crotch and use the rest for handles and interior pockets. Use an old pillowcase or other nice fabric for the lining and Voila!