Well, I started, had to leave it alone, and picked it back up. I'm using 2 strands of some acryllic I had around ( I wasn't sure I'd have enough of anything else). It's funny looking while on the needles - it's curled and looks too small for my 6 year old, but too long for me! I figure if I can't wear it, I'll give it to her, but I do seem to be getting guage, so ....
My mom has some hanging shelves. It's an eye screwed into the ceiling and these hanging metal things shaped like |_| that she put some pressboard across. Use some glue/modgepodge and some scrap to cover it (like a mosaic almost) and use the vertical space.
Also, ANY place you can stick some L brackets (under the desk, at a corner) to make cheap shelves is good for small stuff like thread, fabric, notions, etc.
Can you make a "wall" of those plastic drawers to separate your craft area from the rest of the room?