Several weeks ago I bought a set of Knifty Knitters at Wal-Mart. I'd been interested in the nice wooden knitting looms I'd seen online but was reluctant to order something I wasn't sure I would enjoy; looms showing up at a local store for really cheap made it easier to risk I'd like it.
As it turns out, I do enjoy looming. I never learned to knit and my crochet skills don't really go any further than chaining, but it's nice to be able to do something with yarn other than sew it to a doll's head. Knitting on the loom is an easy, pleasant activity to do while watching DVDs. The basic technique takes only a few minutes to learn, but there are variations to keep you interested. I've already made four adult hats and seven baby hats, including the one I made just to learn the technique; the three cutest baby hats I've already given away to a former coworker who has a new baby. I'm currently working on a camouflage hat for my father and learning to do flat panels by making dishcloths. I hope eventually to make a Harry Potter scarf or two (Gryffindor and/or Ravenclaw) and maybe a shawl.
As for the Knifty Knitter looms themselves, I don't see any problem with them. They're made of a sturdy plastic. Occasionally a single fiber from a strand of yarn will catch on the little ridge (that raised bit you sometimes see on plastic products where the part came off the mold at the factory) in the plastic pegs, but it's not a problem for me. People who wanted to loom things in a smaller gauge might want to buy a different set, but I think most people interested in this would be happy with the Knifty Knitter.
If I had it to do over, I wouldn't bother buying the little Knifty Knitter instructional booklet. There are some websites with instructions and free patterns for knitting looms that do a better job than the booklet. However, the booklet is only 97 cents and if I were buying Knifty Knitters as a gift for someone with limited online access, I'd get her the booklet too.
The very best instructional site is Decor Accents. This site has both written instructions and short how-to videos. They also have free patterns. The free patterns aren't written for the Knifty Knitters specifically. Although Decor Accents sells Knifty Knitters (they recommend them for children), their focus is a broad collection of mostly wooden knitting looms, boards and rakes. As far as I can tell just looking at the site, they seem to make a fine product. If I ever decide to buy a knitting board or another kind of loom, I will almost certainly buy from them, just because I like their instructional information so much. (Note: The link to their flat panel removal instructions is broken--apparently mistyped--but here it is.)
Free patterns and instructions are available elsewhere online. Provocraft, the makers of Knifty Knitters, has five pages or so of free projects. The Loom Room has instructions and several free patterns. Bev's Country Cottage has instructions, patterns, and a lot of links. If you search for "knitting looms" at Yahoo! Groups, you find a good many groups; someone on Craftster said KniftyKnitters is the best, but I haven't tried any of them and can't say.
Knitting on a loom may lack some of the coolness of a couple of clicking needles--I just can't see Miss Marple with a loom, plastic or otherwise--but it is fun. (Besides which, you might not want to take your coolness recommendation from someone who thinks Miss Marple is cool.) I recommend it for anyone who thinks s/he might like that sort of thing, anyone who has a need for a lot of hats, or anyone who wants to buy a low-tech, non-noisemaking, no-batteries-required gift for a child.
Another reason I'm glad I bought my Knifty Knitters, is that now that I've tried it I finally understand how spool knitting works. A couple of people on a Usenet group I used to visit years ago were describing knitting on a spool when they were schoolgirls (apparently it was popular in the '50s), and for the life of me I just could not understand how it worked. I would almost picture it, but not quite get it. That really bothered me. But now I know. And yes, I realize it's entirely possible I have mental problems. Now to find a bunch of historical reenactors and learn how to use a drop spindle...