Elf house on a tree! That would be cute in the garden, especially in the tree over grown with ivy. How about some battery tea lights in the windows during outdoor parties. I hear the fairies/elves whispering "home school project" in my ear.
Log Bird Feeder - 23 DIY Birdfeeders That Will Fill Your Garden With Birds (my note: I haven't looked at all of these, but at least one is a terrible idea. The window birdfeeder -- birds could fly into the glass and hurt themselves.
Turn a tree stump into a "gnome home," or fairy garden.