If you have some plain scrunchies, you can dress them up in a variety of ways. Here are some ideas to get you going. You might find that putting the scrunchie onto a can to stretch it and hold it in one position will help with the decorating.
Parental supervision is recommended.
This project is rated EASY to do. Sew to the scrunchie, adding a few beads or a special button to cover the knot. Take a couple of wide ribbons, put one on top of the other, and make a bow. Sew the bow to the scrunchie, making sure to stitch through the center of the bow so that it will not untie. Make a special button or bead with Fimo or Sculpey according to manufacturer's instructions.