Depending on what their situation is, and what type of illness, pretty much anything creative or fun is good.
What about if you bought some cheap brown cardboard boxes....? Like little boxes with lids, They could decorate them, paint, stick things on...
A techniques that looks really good is to use normal 'white' glue and tissue paper, but, put the tissue paper down first, then apply the glue on top, so it kind of gathers in places, apply a few layers with some thicker in some places so you can see them underneath. Also experiment with colours. I once scrunched up a long piece and made the outline of a heart, put glue over the top and then layed a thin piece over and glued down some more. Adding things like wool or felt and other textured things too to make a mini usable piece of arty storage for any further craft projects.
ATC's are a good idea. They could make a bunch of different ones showing different emotions, how they feel or how they would like to feel.
I've seen plenty of things too where the aim is to draw a "circle" full of things... Called a mandala, used as a form of non conscious drawing. Play some calming meditative music, do basic meditation to help them clear their minds and get them to draw or colour without thinking of what they are doing. Just do what ever comes to mind. A counsellor I had once did this with me and it was very effective, and also made some really pretty and cool images.
Other meanings of mandala
In the West, mandala is also used to refer to the "personal world" in which one lives, the various elements of the mandala or the activities and interests in which one engages, the most important being at the centre of the mandala and the least important at the periphery. Depicting one's personal mandala in pictorial form can give one a good indication of the state of one's spiritual life.
Any basic brown air dried clay work is good too, pretty cheap from a school's supply store too... They could make anything they can think of... Bowls, plates, plaques with their name's... A sign for their room, or their children's if they have any. You could literally make anything out of clay like this, with a little water they can smooth down any imperfections, and it doesn't have to be fiddly or precise either.Once the clay things are dry, they can then paint and seal them with a basic clear spray sealer.
I've made many things from clay, In high school we had to make an E.F.O or exaggerated functional object. I made a large purple cow with yellow spots and a large head with a hole in it's back to hold stuff. You could get them to make long 'snakes' of clay and layer them to make bowls, then smooth down the sides or leave them bumpy for effects.
This kind of thing also lets them be creative without any restraints. They can be influenced by others creativity and then come up with new ideas from that too.
If you only have limited time, spray each item with a spray bottle of water and cover in plastic wrap so it doesn't dry out till next time.
Buy blank notebooks with a plain cardboard cover they can decorate, using anything... That way they can have a journal for writing in, writing is very theraputic too.
What about a large mixed media group art project? You could buy a cheap large canvas from a dollar store and let them go for gold with any type of media, they could brain storm ideas for where they want it to go, or juist go for it and see what turns out.
I think that you could do pretty much anything too.
And I think I may have inspired a few ideas for myself too.
What about group cooking projects too? Millions of ideas you could make there.
p.s. You have one of my dream jobs.... xxx