Send gluten free alphabet pasta for the activity, then send whatever cereal your child can eat as a snack. Just explain the situation to your child in advance. My dd just finished K, and this is what we did, and it worked well. For her, something like this would have been close enough. They only have a couple minutes to eat the cereal, so there really isn't time for her to be singled out.
We had a similar incident. On the first day of school, my dd's teacher wanted to make cookies in the shape of a hand out of pillsbury dough cookie rolls. My dd and I brainstormed a lot of possible solutions in case I couldn't find one that would work. She would have been fine if I had sent (non-hand-shaped) cookies for her to eat. She would have been fine if the teacher sent the cookie home in a zip lock for me to evaluate (and later reject), while eating her own snack. There were a bunch of other possible solutions that she and I came up together.
So just ask the teacher what exactly she is going to do during the activity, so that you can figure out if the letter-shaped pasta will work with the craft, and ask your child to help you come up with a solution (with your suggestions).
The prospect of snacks for an allergy in K seems daunting, I know, but my dd did it last year, and the isolation problem turned out to be a nonissue. (However, it is true that my dd has had to deal with this at daycare since she was a baby.) The isloation issue will be fine, you'll see.
P.S. Your bigger issue will be playdough, I think. My dd's teacher made her own a couple weeks before school started. Maybe suggest to your child's teacher a recipe using corn starch?
