We have this piece of furniture in our kitchen:http://www.ikea.com/ca/en/catalog/products/60045393
I know that it is pricey. We saved for it for a long time. It is such a versatile piece of furniture that I know we will have it forever. It will serve us well no matter where we are living, also.
I currently use it both for kitchen stuff and arts and craft stuff. One of the top drawers has all of the stuff that I didn't want my baby having free access to: markers, crayons, scissors, water colour paints, glue, chokable glue-on stuff, etc.
I have some sea grass baskets (8 total) along the bottom two shelves (we set the shelf heights differently than the image that I linked). In those baskets I have: playdough and playdough accessories, paper, table coverings/art smoks, activity and colouring books, recipe books, and homework stuff (school papers, pencil case). The baby would dump the baskets on a regular basis, but if it was driving me crazy, I could just put them on top of the table for a while. I have tried MANY systems. This one is, by far, the best one so far. I want my kids to have free access to the crafts without me having to look at clutter all the time. Also, my baby is now 2 and is better with it all now, but when she was little the system worked, too.
Oh - I also keep extra craft stuff in the basement. The stuff that I don't want anyone to have 'free' access to, or that is too big, or a single-use craft kit type of thing, goes there. So I have a bin of painting stuff, Craft kits, Stamping stuff (not washable) etc. downstairs. This really helps keeps the clutter to a minimum, as well as keeping some art stuff 'fresh'.