Lines across has the most fantastic ideas for how to wrap gifts for kids adding toys, crayons and stickers to make the gifts interactive.
Get the instructions here:
http://www.linesacross.com/2012/12/interactive-gift-wrap-for-kids.html
Real simple suggests decorating with a bunch of colorful rubber bands.
Get the instructions here:
http://www.realsimple.com/new-uses-for-old-things/new-uses-gifts/rubber-bands-as-gift-bow-00000000044166/index.html
Get the instructions here:
http://www.minieco.co.uk/diy-word-search-wrap/