There's also a thread on Ravelry about someone who successfully dyed yarn with sugared kool-aid and how she did it. In the same thread is someone who dyed yarn with powdered jello.
I bought 12 packs of kool-aid this afternoon. At $0.33 per pack it's not expensive, I don't think. I'm guessing at 3 packs per color I want to dye. I got 3 red, orange, purple, and I think I went ahead and got a pink...either that one or blue, I'm not sure. My sister is sending me some paton's merino wool to try it out on. I wasn't aware you could do blends, but now that I know, I have some ideas I'd like to work on....
Oh and in addition to the knit picks and knitty tutorials, I found this one
to be my favourite.