I got leather scraps on Ebay and most of them are working out well. A few of the pieces they sent were too small or too junky to use, but I think that's the nature of "scrap lots" on Ebay. Mine were upholstery scraps. The colors tend to be furniture colors, iykwim, like brown and tan and burgundy, which is fine. I'd love to have some nice pink and purple and other girlie colors but these pieces were relatively cheap. You have to watch the shipping as well as bid price b/c they can cost a lot to ship. I did also buy a pair of red leather pants (size 1! who wears that???) and cut them up for shoes but the leather was too thin and they didn't hold up well. Some other people have suggested going to an upholstery shop or furniture store and asking if they have any leftover scraps or any old samples from the upholstery books that are no longer in their current line.
I bought the Chloe Toes shoe pattern and it has a bunch of suggestions on materials and where to get them. She recommends 2.5-3.5 oz leather (which helps when you're trying to pick leather to buy on Ebay) or cutting up old purses or leather coats. You can also use fleece or ultrasuede (honestly tho, when I looked for ultrasuede, it was more expensive that leather!!!).
The shoes are super easy though. I love the pattern I got b/c the shoe styles offered look more like "real" shoes than some of the other soft baby shoes. I don't really care for all the little kitties and puppies and stuff. I really just wanted basic shoes. These come in a basic style, a Mary Jane (cute for girlies) and two different woven styles. The woven ones were my favorite for summer. Way cuter than the Shoo-shoo and Robeez type sandals we had before. I would add that if you really wanted cutesie kittens or whatever, you can still do that with this pattern. You can do just about anything you want starting with the basic style. But I am not so good at thinking outside the box and so I was happy to have a pattern that layed it all out for me.

My only regret with this pattern is that I missed out on a coop for them. They run coops once in awhile on one of the Yahoo groups and they're much cheaper. $16.99 is a lot for me to pay for a pattern, even though I really, really like it. If you can catch a coop, go for it. Now if one of the coops would just offer leather, I'd be over the moon!
This post reminded me that I need to sew more shoes for Addie for wintertime. I want to try making them with padded or lined soles. I've seen some with felted wool linings and with sheepskin linings. I wonder what would be best? I thought about fleece and I have plenty of that so maybe I'll try it. But it seemed like a natural fiber inside would be best. I even have some rabbit skins. Do you think rabbit fur lining would be nice? I am afraid to even attempt sewing it tho. It sounds too difficult.