Are the nursing home items also supposed to be handmade?
Are you considering small diy kits with some supplies, or just finished items?
I think fingerless gloves would be a great option for donating to a nursing home for men and women. Sometimes elderly people can have poor circulation and get cold extremities, even inside. Fingerless gloves are easier to put on and take off than gloves and mittens, and they're great for indoor use when people still want to use their hands for eating, playing guitar, painting, or whatever. If you have thrift stores nearby, maybe you could check for 100% extrafine merino wool sweaters to felt in the washing machine and then use to make gloves. I can usually get 4 or more pairs from one decent merino wool sweater, more if I don't make them super long. I say merino because while cashmere is wonderfully soft, some people find it a bit too fuzzy. Merino is also much easier to find at a thrift store than cashmere. I think other kinds of wool are potentially too scratchy. I know my husband much prefers merino wool for fingerless gloves (he wears them at work in the winter - he's a programmer). My mom likes fingerless gloves because it provides gentle compression on her sore joints (she has arthritis), so they're soothing. My 5 year old autistic son likes fingerless gloves because they help his sensory needs. If you're making a bunch of them, it's simplest to just sew a tube and cut a hole for the thumb. The sleeves of the sweater usually make at least two pairs with little to no need for sewing on those pairs (since they're already a tube - the higher part of the sleeve makes gloves for larger hands - only sew those if they're way too large for anyone).
What about decorative pins for the pincushions? You can get fancy with those and use polymer clay, or keep them simple with some matching beads and a bit of glue to secure them.