Flannel is so cheap and easy to get and works quite well. I've been sewing up a storm lately and selling on ebay, and making enormous profits. Its ALL in the detail - even the most basic fabric can be jazzed up and made to look really professional. Some of my successes have been:
basic flanelette prefolds - simply four layers of coloured flannelette (at $A2.20 a metre) sewn together, and sewn into thirds to be trifolded. Serge round the edge with variegated jeanstitch, and voila - a gorgeous item a la those FCB squarefolds. I've been selling these with a coordinating wrap - I just made the pattern up by tracing a prorap - with a knit outer, FOE binding and am getting about $40 for a wrap and three prefolds. This is SO quick and easy to do. The prefolds could certainly be pinned, and to snappy, you could just make an outer layer of towelling. I made some topped with velour which are so gorgeous I kept them for Eliza.
I also made fitteds out of towells I bought on sale - a layer of knit outer (you could use an old garmet or printed flanelette), a layer of towelling with an extra layer just sewn in the wet zone, and an inner layer of coordinating coloured flannel, with a lay in soaker of two layers of towelling topped with microfleece. Pretty coloured serging and again, a beautiful item which has sold brilliantly - like over $20. Sadly, I have to use velcro closures, but might be able to buy a snap press soon.
If she has a serger, all of this is extremely quick and easy to do, I can churn out about 20 of those prefolds in a days work. Its cheap too - I could have sewn Eliza's newborn stash for about $75 compared to the hundred's I spent buying ordinary, non WAHM items from the US.
You can certainly do it all without a serger too - just turn and topstitch instead - but I find that that leads to hard seams, lumpy corners and just a not quite so comfortable diaper.
And certainly you dont have to go to so much trouble to make them pretty, but I think it makes diapering so much fun to have gorgeous items, alas, its taken me till now to realise you dont have to spend a fortune to get them.