This is one of those times when I find myself wishing I owned a sewing machine. And that I had a single crafty bone in my body. Check it out: Gulf Coast Cottage, a wonderful shop filled with soft toys, has an entire category filled with nothing but PDF patterns for felt toys you can make yourself.
Find More: Doodads and Random Bits of Coolness, Free or close to it, Toys and Other Playthings
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These are just adorable! I want them all!
Back in my day, the thing was plastic food by Fisher Price. I've seen a number of cool new ideas for felt toys. I suspect they can take up less space and would be considerably cheaper depending on how much your time is worth. I do suspect, however, they would not be as easy to clean as the plastic ones were.