Today I came across a collection of homemade air dry clay recipes at "Crafting a Green World" that are kid-friendly and earth-friendly. Recipes include basic natural play dough recipe, aromatherapy play dough, gluten-free cornstarch dough, edible play dough and modeling beeswax. See Five Natural Modeling Materials You Can Make Yourself.
Author says: "I tend to choose to make our modeling materials for a few reasons. I’m much happier spending a hour in the kitchen every few weeks mixing up several batches of natural play dough than I would be spending that hour driving to the store and back for Play Doh."