I found great instructions and videos on this in addition to books. http://www.tutorials.com/06/0697/06971.asp video: http://video.about.com/familycrafts/How-to-Make-Paper-With-Kids.htm
Recipe: 3/4 cup torn paper--use old copier paper, construction paper, lined school paper
3 cups water--pulse in blender until well mixed
1/4 page of colored tissue paper -- add and pulse
On Wednesday we made books from cereal boxes, a project I found on the Knackids site: http://www.theknackids.com/ProjectView/Code/kn0822.aspx The campers learned about all kinds of different papers, including watermarks, and were able to put samples of 5-6 into their books. We added lined paper so they could make notes as journal. As you can see above the cover even got artwork.
The Arts mini-camp is held at the Wells Branch Community Library and taught by Dianne Koehler.