www.woolclip.com Woolclip are based in Cumbria and love herdwicks. They might have some ideas in their gallery, or maybe you could get to woolfest itself. I love their felted herdies.
I'm sure I've told the tale before of my MiL knitting me a jersey in Herdwick yarn. It apparently made her fingers bleed - I think a lot of nasty names for me were knitted into that garment
. Then of course I could only wear it on dry extremely cold days, so not very often. It was immensely warm - you can see how the sheep are so hardy
I like the idea of a pegloom rug - no skill required and the finished product would be indestructible
. You could also try felting a fleece into a vegetarian sheepskin, which is mentioned in the TAS crafts section. It wouldn't be cuddly, but it wouldn't wear out for many years on the floor.
Heb fleece can be used to repair potholes and I think herdwick would be even better. Dig out the pothole a bit, line with a herdwick fleece, fill with rough stones, then drive over it a lot. The fleece felts and holds the stones in place for much longer than just refilling the hole with stones alone.