I recently took an online ornament class and learned how to make these watercolor pieces. http://christytomlinson.typepad.com/christytomlinson/workshops.html
Book paper cut into the shape you desire, loose watercolor then doodled with flowers, sewn together and filled then embelished – done! (I put a layer of gel medium over the top of the painting to give the book paper more strength – old paper is very delicate and tends to tear when filled)