One tip: You get more "strip" out of a yard of fabric by cutting it on the bias, but you can cut it along the grain in either direction as well. I have directions here somewhere on cutting a continuous bias strip that I got for free from JoAnn's. You can probably find directions online.
One more tip: You can sew, glue, or tie the strips together, depending on the look you want. If you cut strips the short way, you could tie them and have your piece be a rustic look.
And Again: I have directions for a project that says that 1/2" strips of lightweight cotton done on a #10 needle approximate the gauge of worsted weight yarn. Have fun!