I just don't think I personally would be comfortable making people buy used gifts. I don't really think I'm comfortable dictating what type of gifts people buy.
I also often felt uncomfortable tandem nursing my twin toddlers in public, but it was something that just had to happen sometimes. Instead of losing myself in how uncomfortable I felt, I'd try to think about how I was educating people all around me about breastfeeding and showing them that some people do nurse their big toddlers--at the same time! I think it's a similar sort of thing with this gift issue. I'd rather not say anything to anyone about what gifts they buy or don't buy for my kids. But I *have* to say something because I can't just sit back and watch us destroy our earth. I just have to think about it from the perspective of "I'm opening their minds to this really big issue of over-consumption." Someone has to be the first person to say it, but then others will surely follow suit, and before we know it, we will have made change.
I definitely think that the best solution is just to say, "no gifts please," or "your presence is gift enough!" and perhaps a little blurb about why you are making this choice. But if you really don't want to deny your child the experience of receiving many gifts (which, IMO is a separate issue), or you don't want to deprive your guests of the experience of giving something to your child, then I think suggesting that they buy used or make something by hand is a fine second option (like, for instance, my mom just can't imagine not giving her grandchildren gifts for their birthday. That's fine. She can make them each something).
It is not a happy, joyful thing to be doing what we are to our earth. It's uncomfortable. It's easier to pretend that it isn't happening. But that doesn't mean that we can just keep on like this. In my opinion, it's really not a matter of "what works for my family" anymore. It's what we all HAVE to do. Anyone can choose to ignore the issues, or they can choose to have some awkward conversations and make change.