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I just bought several sizes of wood beads from WoodWorks for this. Actually, I bought little wooden balls (undrilled) to do this version and some with big (3/8") holes to do the version where each bead is covered individually and then strung (on ribbon or something). I haven't had a chance to play with this yet, though.
If Dolly Mixx's pictures are any indication the wood balls will work just swell!