Circle background 1 - Cut 3, 6.25" circles, 2 fabric and 1 cotton batting. Layer the fabric circles right sides together, fabric on top of batting circle. Pin and sew around the circle leaving a small opening. Turn right side out, smooth seam with a chopstick and press. Close opening with whip stitch.
Applique Background 2 - Trace a 5" diameter circle on sew in interfacing. Lay interfacing on top (right side up) of applique background fabric. Shorten stitch length to 15-18 stitches per inch and sew around circle on drawn line. Trim around circle, 1/4" seam allowance. Cut slit in interfacing only and turn circle right side out.Smooth seam and press.
Reduce the applique templates by 50% so they end up being approx. 4" tall. Trace reversed templates on to fusible webbing and fuse to wrong side of applique fabrics. Cut out appliques on drawn line, remove paper and fuse pieces together using an applique pressing sheet. Carefully peel assembled applique from the pressing sheet. Fuse to background 2 except for anything that hangs over on to 1st background. You can download and follow the instructions for assembling appliques from the original recipe. http://www.modabakeshop.com/2011/12/sock-santa-modaelf-rudolpharilla.html#more
Most of the embellishment for these is done on background 2. Interfacing and anything you don't want to show will be covered when ornament is finished. The interfacing makes a nice stabilizer if you want to outline the characters in satin stitch. I also added some hand blanket and stem stitch for fun. Fuse any pieces that hang over to background 1 (like Santa's pom pom) last. Button eyes, tiny light button earrings and a ribbon are used for Rudolfarilla. Oh and a little gold snowflake found in the button box for some sparkle. Sock Santa has one button eye and a bead for the other. I finished by stitching background 2 to background 1, using blanket stitch and metallic embroidery thread. Then one more time around on first background edge with blanket stitch and a piece of embroidery thread is used for the hanger.