I've read all the horror stories of Lion Homespun and had worked up a poncho in it before reading those posts. Hated it, tore it all out. It stretched out horribly. But then I made a shrug out of it and love it. I knitted it tighter and it has held its shape. I wear it all the time. So, maybe it's okay for smaller pieces.
Thats an easy one... Lion Brand Kool Wool. Not a big lover of Lion Brand - but this exceeded my expectations and then some! It's easy to work with, springy, light, forgiving, and comes in really nice colors - especially the heathers (camel is my fav.)