Sorry it has taken me so long to post. I LOVE this machine!! (Brother SE-400). I've been able to make all kinds of cute things. For my 3m old, it's 4x4" hoop is perfect. I've made a few things for friends, and the size doesn't seem to make a difference. If I want to add a name, I just re-hoop it lower.
Also, you DON'T have to use expensive embroidery thread. It takes regular old thread just the same.