Saw this picture and was inspired! Took a cube shelf like this and lined the back with material to match the nursery. Got baskets to put clothes and such in and instead of putting it in a closet I put it against one wall. I also like the baskets on the shelf to organize and hide, so I did the same for our daughter's nursery. Liapela.com
Baby clothes are so short that they don't take up much vertical space in the closet. KALLAX makes great use of most of that space by storing small items, books and toys. See how Chelsea used her KALLAX on her blog, Two Twenty One.