My friends & I held a rollar prom earlier this summer with a beach theme so I dressed as a mermaid. I thought of it the day of though so I had to whip something up quick. I used a black stretchy tube skirt that I already had and added a fin made of cardboard covered in a blue sequin fabric. [I saw the fabric you're talking about at Jo Ann's and it's perfect!] I wore a nude colored shirt and bikini top with it. Here's a paint version of the skirt:
The black is the skirt and the blue is the cardboard fin.
I liked doing just the fin in the sequin fabric because then you didn't have to buy as much and it was different than everyone else's mermaid. Good luck with your costume.