Redoing chairs-- usually they're odd dining chairs I've either thrifted or helped myself to on bulk trash day-- are a favorite of mine. I haven't done a desk chair, though. I kind of wish I'd thought of it before having bought an actual desk chair.
I think the fabric you chose is perfect for the style chair.
I like the Peep hat idea! And yes, you're quite right, the Peeps are not light and fluffy when they dry out. The Peep garland I made last year is HEAVY. And it's not just because it's loaded with beads, either.
Ah, trash-to-treasure meets sugar rush when year-old Marshmallow Peeps become part of a cardboard carnival attraction... I thought if any folks would appreciate this funny little craft project, it would be the folks here on Craftster!
There's a step-by-step tutorial with lots of pictures here: