Funny you should mention this. I've been looking at pictures since I got home from work. There are so many different ways to do it. I'd suggest going to Google Images and search t-shirt quilt, then browse through the hundreds (and I mean hundreds) of images of quilts people have done. The only thing you really need to do is stabilize the knit fabric with a lightweight fusible stabilizer so that when you start sewing the fabrics together they don't stretch. You can add cottons or just use nothing but knits. You are only limited by your imagination! http://whipup.net/2009/04/30/make-a-t-shirt-quilt/ is a fun one.
And the two images below I really like how they are set up, i like the framing on the yellow/blue one. The 2 quilts I am doing is from solid color tshirts so I think I am going to go with the one with all the red in it. As far as quilting it I'm thinking a large simpler design is best on the knit fabrics.
Hey Laura, Thanks for the visuals. I was afraid to get sucked in if I googled it. The middle photo might be the best for me as the shirts are all different sizes, ranging from toddler to teenagers.