A fellow crocheter at the college emailed me to ask "Where you do you usually donate your crocheted items?" I thought I would respond here too for others.
It has varied, but all are in the area where I live. Instead of spending money on postage to send items away, I've chosen to concentrate on local organizations (that way, I can buy more yarn!).
I crochet lap-size (wheelchair-size) blankets and give 'em away in November or December. The first year I donated the blankets to a small hospital; the next two years to a small, needy convalescent/nursing home; and last year to a church.
There are many ways to donate handmade goods. Warm hats and scarves to homeless shelters. Afghan squares for Warm Up America (http://www.warmupamerica.com/) through Michaels Craft Store (http://www.michaels.com/). Dog-size, cat-size blankets to animal shelters (Hugs for Homeless Animals http://www.h4ha.org/). Project Linus (http://www.blankiedepo.org/). Baby blankets, layette sets, booties, caps to premie wards in hospitals. Colorful toys, soft hats, blankets to children in hospitals. Very soft chemo caps for cancer patients undergoing chemotherapy (http://www.bevscountrycottage.com/cancercaps.html).
More ideas/links are at Crochet 'n' More - Charity Links (http://www.crochetnmore.com/123charitylinks.htm).
So much yarn, so many projects, so little time...