I have finished my first attempt at a felted bag. It was made from some test squares for another project. I sewed the bag pieces together and added a french knitted strap. I sewed the strap on so that it ran from the bottom of the bag on each side. I felted the square for the flap at the same time but I attached it after the felting. I use blanket stitch to attach the flap. I also ran a line of blanket stitch along the top edge of the bag. All in all I felt pretty pleased with the end result. More pictures in my Picasa Album - Felting Attempts.
17 hours ago