2T white glue
(1T ground nutmeg, optional)
1T ground cloves, optional)
Combine dry ingredients, add applesauce and glue. Mix until blended, form a ball and knead on cinnamon-sprinkled surface until it holds together well. Roll out and cut ornaments with (I'm using teensy gingerbread man) cookie cutters, and use a straw to put a hole in for hanging. Dry on wax paper, turning periodically so cutouts stay flat and dry evenly, for about a week or until completly dry.
This is what I'm making for my coworkers for Christmas. They're easy, smell really good, and I can make a ton of them - enough for everybody with little effort. :)