We made soap and toothpick sculptures a while back, after falling in love with Make and Play's soap sculptures. These are similar to the marshmallow and toothpick sculptures we've enjoyed making, but non-edible which may be key for you if your kids just eat all the marshmallows (several people told me thats what happened when they tried it!).
As Vera from Make and Play suggested, I bought a few different colors of transparent (glycerine) soap and cut them into small squares, rectangles, and triangles.
Then we used toothpicks to connect soap pieces and build little sculptures. The glycerine soap is soft enough that you can stick toothpicks in fairly easily, but it was just hard enough or maybe just a tad crumbly enough that it got a little frustrating for Maia at times. I don't know that I'd try this with kids younger than her. Or maybe it was just my soap. I dunno.
But the possibilities with this are great!
I don't seem to encourage sculpture nearly as much as painting and drawing and would love to branch out. Do you have any ideas or favorite sculpural materials to share?