I get the same urge periodically. Unfortunately, I'm not very patient and sometimes end up ruining things...but that just gives me the excuse to go to Salvation Army and stock up again.
Anyway, some of my favorite projects are:
--the old reliable jean skirt conversion. This spring I made them short in faded denim with darker denim patches. Also, several years ago Gucci showed a denim skirt I'd love to replicate: faded and distressed denim, with appliqued/embroidered roses, leaves, & vines. Nice with a western shirt for that rockabilly look.
--last year I cut t-shirts into tank-tops. Be aware of the stretchability of your top, though.
--I wear scarves a lot, tied in what I like to think of as "jaunty" ways.
--I customize thrift-store skirts by hemming them and adding different trims like ric-rac or ribbon roses.