I have thread coming now, (thanks =D) but I kind of like the tightness the elastic offers, is it a bad idea to use this instead of thread?
Personally, I don't like to dictate rules and applaud your creativity and bravery in trying something different than what you feel you were supposed to use. I don't think elastic is a bad choice, at all, especially since you like the way it turned out. Thread will give you a different look as well as a different drape and I have a hunch you'll like that look as well. Using thread for peyote would be more economical as well, due to the longer lengths needed for these projects.
For the future, here are a few tips to consider when working with elastic cording:
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