I forgot to take pictures of these before they were mailed to Grandma, so use your imagination!
First, I had the kids shred their old broken crayons using crayon sharpeners (pencil sharpeners are generally too small for crayons). They put the sharpenings on wax paper, in a thin layer. Then I put another layer of wax paper over top and ironed them until the sharpenings melted and ran together. (Be sure to put an old rag underneath the wax paper and another over top of it so that if any crayon gets out, it won't get on your iron or ironing boards.)
Then the kids used cookie cutters to trace Christmas shapes on the wax paper (markers work best for writing on it), and cut them out.
Joseph did find that you can use a pen to score white lines on the paper, unfortunately, it tends to make the layers of paper and crayon separate from each other, too.
Even Michelle made a couple - she didn't get the sharpener bit, but it still looked good just with stripes of crayon that she had drawn on (the wax paper will stick to itself when you iron it, so don't worry about having holes in the layer of crayon).