Hi, Sharon!
Great question!
We are one of the families who save every scrap of everything memorable from our trips to Walt Disney World, so I completely understand your wish to preserve the memories. (I even have some of that iconic Mickey confetti at my desk at home as well as by my desk at school. Makes me smile every time I look at it!)
For crafty ways to use the paper confetti from WDW parades, etc., you've got so many options! First, consider purchasing a wooden picture frame, in the size of a photo (or a collage-style set of frames for several pics) from favorite celebratory moments on that trip. You can use the confetti to decoupage the frames, a fairly simple method of using glue to add a protective coat to the papers you've arranged on the frame. Each time you look at those photos, surrounded by that confetti, you'll be sure to grin. Familycrafts.com has a simple set of instructions on decoupage, and so does
Spoonful.com (a Disney Family site.)
Next, you could organize them into piles by color, then select those you'd like to use for a particular season, holiday or color-scheme in a room and gently arrange them in a suitable container. A square 2' tall vase (we brought one home from a wedding reception) can house items such as these beautifully, as can a shallow glass dish as well. Intersperse something larger here and there and you'll love your new accent pieces.
A third option might be to use them in a keepsake album, along with pressed pennies, Times Guides, photos and other bits of memorabilia from your magical trip to WDW. We used ours to decorate the pages of a scrapbook / photo album we gave to my in-laws after a family trip, so that they, too, could open the pages and be brought right back to the magic of that vacation.
Have fun, Sharon! Send more questions for more ideas or about any other aspect of a trip to WDW; we love to help!