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Hello Darlene, If the design is loose knit and would fall apart if cut, then Machine Satin stitch all around the design and then cut it out....... Have fun!
If the cardigans are 100%wool you can wash them in a very hot wash to felt them, they they won't then fray (although they will dhrink which will reduce your fabric)
https://www.youtube.com/watch?v=BByV8G8qa8E
https://www.youtube.com/watch?v=2wBIG_LRgqY