I am looking for a fun holiday project as well.
I am thinking of finding / buying some holiday jig saw patters to use to carve out of 1/4’ MDF.
I have been having good results with my 1/8" down cut bit and using a harbor freight 1" belt sander to clean up the tabs.
Note, with MDF good dust collection and dust mask is a must!
(Before I got my Dust Deputy the ultra fine MDF dust would just blow right through my shop vac.)
Things I am thinking of:
Snowmen
Reindeer
Candy canes
Gingerbread men
Gingerbread houses
Christmas Tree (2 parts free standing)