As a daycare provider my experience is that arts and crafts for around age 2 is still hard for them to work on for more than 10 minutes without loosing interest. I usually do not introduce crafts till age 3. Don't get me wrong we do color, paint and play dough, but as I mentioned it usually if over in 10 minutes. Here are a few other crafts the 2 year olds seem to say in tuned to.
1. Glue and stick. Buy stuff they can glue on paper like feathers, little fuzzy balls, macaroni & beads. Multi color and texture is the key. Just control the glue they love the taste ;)
2. blocks and string. For some reason kids love to string blocks and large beads. Buy shoestring and those blocks that have holes in them. Made sure the holes are big enough for them to put through. If it is too small they will give up. This also helps with learning colors and shapes.
3. styrafoam and pipecleaners. Most craft stores will have those styrafoam balls (used to make planets for school age kids solar system projects). The balls come in all sizes. Have them paint them then after they dry get those little pipe cleaners and they love to poke them into the ball. You will have to show them how. It is kinda like making a Mr. Potatoe head.
You can make spiders for Halloween, snowmen for christmas or just a wonderful art piece for their home. You can even make a mobile out of all their balls.