The book Peaky Beaky (by Bertrand de Vogue, illustrated by Kelly Oechsli) fascinated me when I was a child. It was published in 1967, and was one of those Tip-Top Elf books. I took my copy out of the closet this morning and was looking through it. I remember vividly that this was my very favorite illustration:
And I also came across this picture, of Peaky Beaky's wife, which made me think "Hmmm...knitting...this could explain a lot..."