Sheets make terrific duvet covers and pillow shams. Use one pattern per side for a reversible duvet cover or keep both sides the same for a uniform look. It's simple to stitch up a few seams, make buttonholes on the open top seam and sew some pretty buttons to fasten the cover closed. Make ruffled shams for European pillow squares and gathered or pleated shams for traditional bed pillows.
Use beautiful sheets pleated at the top like drapes and gathered into columns to adorn the four posters of a bed. The sheets are long enough to reach from the top of each post to the floor and you may even be able to attach them at the ceiling, unless yours is exceptionally high. Sheet columns that match the bed sheets are a harmonious treatment; stark designer sheet patterns might pick up the colors or a pattern elsewhere in the room. Cartoon character sheets with a child's action heroes plastered all over them appeal to the aesthetic sensibilities of the younger generation.
Re-purpose slightly worn sheets that still work with the color scheme of the room as a dust ruffle for a bed. Flat sheets work best for this. Stretch them to allow for gathers by alternating lengths of one sheet and then another in a mix of patterns and solid colors. It's a slightly hodge-podge, shabby chic approach that could be very charming in a little girl's room or a guest room.
Turn a sheet into the fabric cover for a homemade padded headboard. Use two different sheets for a multi-paneled headboard. Just stretch the sheets over plywood padded with heavy foam and staple them to the back of the board. Then hang the panels on the wall behind the bed to form a single headboard. Or, hang one padded headboard with a sheet alternately tightly gathered and left plain in vertical panels to create some interest and detail over the bed.