My roommate is a teacher. I can give you a little insight from observations Ive made over the years.
Not to put down the suggestion to make something, but whatever you do, don't give a mug. This is something that occurs to a lot of people as a good teacher gift. If I have to find space for one more coffee mug in the house... Other things that fall into this category are teacher nick-knacks ("World's greatest teacher," ceramic apples, little chalkboards, etc.) Over 28 years of teaching and 100 kids each year, there's not much room left in the house for these things. Theres even less room in the classroom.
A nice card, or depending on the child's age, a hand-drawn picture are excellent suggestions. These are things that can be tucked away in that year's yearbook, and make for a more-lasting memory.
Another thing I'd recommend avoiding are homemade edible items. There are often "is this safe to eat" questions for a teacher. Unfortunately, some of the cookies and other items make their way into the trash once the kids leave. (My roommate teaches in an inner-city school. You probably wouldn't have the same issue.)
Any token you give will be greatly appreciated. It really does thrill a teacher when a child (or the parents) think enough to remember them at the end of the year. The sentiment that "it's the thought that counts" is very true.
The one he seemed most thrilled by this year was a gift card for Office Max. It wasn't for a lot of money, but he thought it was great and used it for some of the supplies he needs for next year.
He also got a Starbucks card and an AMC movie pass. Again, not for a lot of money, but he enjoyed using them.
