When we moved to a much smaller house, we had to be creative when it came to finding places to hang all of our photos and art. Since my husband and I are both tall, we tend to hang pictures at our eye level, which leaves guests (and our two-year-old) craning their necks to see. I was feeling a little guilty (and tired of picking up the kid so she could look at family photos) so I decided to make a small display of art at our daughter's eye level, right near her toy area, where she could see it every day and enjoy it.
Those are (inexpensive) original watercolors I bought on www.etsy.com, framed in virtually indestructible metal frames that I think cost me $1.50 a piece at a craft store. Liza likes to look at them and make them swing back and forth on their hangers, and sometimes she takes them down and tries to rearrange them. She's even managed to rehang one once by standing it on top of the one below it ... she's got mad small motor skillz, this one does. And the kids who come over to play always stop to check them out, even though I've never seen any of them take a second glance at any other piece of art in the house.
Once she starts making art of her own, I plan to reclaim some more toddler-eye-level real estate on the upper level stairs to hang Liza's work.