I've heard people joke about having enough pet hair to make a few sweaters, and here's a lady who takes said hair, spins it into yarn, and knits it. You can mail her your pet hair. How about THAT? http://www.customspinning.com/
Below, from the website, is collie yarn. :)
Pet Hair Knitting - Wear a sweater in memoriam
Want to join? Register here. Already signed up? Click here to login!