Wow, I am currently attempting to make this myself. I covet 90% of the clothes I see in Anthropologie, but like everyone else I always think, I could make that myself......
I used the following pattern as a starting point:http://www.interweave.com/knit/interweave_knits/pdf_files/RoundtheCapelet.pdf
Instead of joining the chain, I just turn the work at the end. It will be necessary to add increases after about 12", otherwise the cape will only cover your backside (I speak from experience and unfortunate 2am frogging). When the body is done, I will add the ruffle by doing 2 or 3 triple crochet in each stitch space around the sides and bottom. I'll use a crocheted loop and antique button to fasten about the neck. Not sure about how to shape the collar, will have to think that out. There's a zillion flower patterns out there, so I don't think that will be a problem.
I'm using a K hook and Patons Divine in Richest Rose, a beautiful fuzzy magenta 18% mohair/79% acrylic blend. It's about $5 for a 100g skein, but I got it on sale at Michael's for $3.69 about two weeks ago.
PS If anyone out there has ideas on customizing cardigans a la Anthropologie, I'd love to hear it.