We're cutting back this year too. We have been progressively
trying tothe last few years, but this year, i'm determined. I love the food baskets, and wish people did that for us. I'd much rather have something yummy and thoughtfully handmade than anything store-bought.
I would LOVE the chai recipe mentioned earlier! 
I'll probably follow the same lines: Homeade apple butter, granola, some sort of confection. I also like to can homeade soup in the fall. It allows us to have a nice dinner when one of us is ill, or we are on the run. I may give some chili or veg. beef soups to the family.
Another tip is to shop thrift/Goodwill for books all year. For the readers in the family, I can pick up nice novels for $2. We used to spend a portion of the money alloted for each child on books every year. Now, I shop thrift year-round and find some amazing books to sock away until Christmas. Last year I got a 2 inch thick animal encyclopedia in new condition for $2!
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