Fred and Suz at BFC Creations have this lovely Christmas ornament design. Scroll down the home page to find the free design link on the right hand side of the page.
Urban Threads have this delightful Let it Snow design free until December 29
BeeStitchin Embroidery had a12 days of Christmas event at the beginning of the month and some wonderful stuffy toys, decorations etc are on their site for free download. Be quick as they may not be up for much longer. The feltie outline below is just one of the designs available.
This Googoo design would be great on a baby bib