great idea softie! i'd suggest copper thread if you're scared of getting poked
for shrunken shirts i usually cut the sleeves back to 3/4(if they were full length) and let out the hem. or i'll take two shirts and cut them up and combine them together somehow.
my favorite: get a ton of safety pins and glass beads and string the beads onto the pins, randomly or in a design and pin them to the hem of your clothes for an added length and flair. if you don't have time go to your fabric store and get a length of trimming with beads on it and sew it to your clothes.
uhmmmmwhat else...oh yeah bleach. get a cup of bleach and a q-tip and fade out designs onto your clothes.
and if i don't like the completed piece i just take it to the Buffalo Exchange and trade it in for new stuff.