This is so practical, a foldable bassinet that converts into a toy box from http://www.dasmoebel.at/
This castle bed fits a twin mattress, while the space below can accommodate a twin or full bed, or may be left open as a play area. Sure to inspire fairy tales and medieval games. The wood that has been used to build this bed is sustainably harvested and plantation grown, so there is no impact on the ecosystems.
This playhouse if 100% biodegradable, made out of 100% recycled cardboard. Also foldable for easy storage. From www.modernmini.com
You can even decorate to look like this...
Too bad, I can't purchase any of these things locally. Due to the lack of choice, I will just have to settle for the most practical and affordable children's furniture from IKEA...sigh.