Fran, I happen to do a lot of polymer clay type things (figurines and dollmaking). Sculpey and Premo and Fimo nowdays come in flexible versions too. 
I'm not completely sure if those will give you the skin-like flexible covering of the type that can be found on toys.
For all things polymer clay, you might wanna try http://www.polymerclaycentral.com/
Lot of jewelry there, but you can find some awesome model and doll makers there too :)

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