craftgrrl | A mini purse and questions regarding mini pillows and hoodie repair

First off, a little purse!

I got this fabric at a fat quarter sale, it's so pretty! The camera doesn't pick up the shimmer of the gold very well. It's about 8x6 inches and the vintage button is just for decoration, it has a zipper closure.

Second, I'm making miniature pillows for someone, and I can't seem to get them to look the way I want.
I turn them inside out and sew down the open side, but then it looks pinched, and the stitches are too visible. I'm hand-sewing these. Should I just be doing smaller stitches? These are practise pillows, he wants them to be a sort of boudoir-style. Any suggestions?

Next, the sleeves on my favourite hoodie are just destroyed. Any suggestions as to how I can repair or cover these? I thought of cannibalizing another sweater for its cuffs, or maybe just covering these ones with another fabric. I'd love to hear your ideas.