I finally got around to taking pictures of this little project. (IOW, my dd finally consented to modeling it!) This headband was made using a 10-peg fine gauge keychain loom that Isela Phelps gave out to people at the Knit Out at the Mall of America in Minneapolis in February. The headband pattern was part of the give-away. It is knit in a garter stitch pattern, with tapers at the beginning and end.
The recommended yarn in the pattern has some stretch, but I used some regular old worsted weight from my stash, and there's enough stretch in the garter stitch pattern that the headband fits comfortably and goes on and off easily.
It would be cute worn this way too.
If I were to make it again, I wouldn't use all the pegs, as I like my headbands a little narrower. I'd also do a longer section that is narrow to go along the hairline at the neck, and move the tapers closer to the ears so the width is just where the headband shows on top of the head. It really is an easy project, though knitting with a fine gauge loom takes a lot longer than knitting with the large gauge Knifty Knitter looms!