We deal with "special toys" similarly. The kids have to decide BEFORE friends come to play - no snatching toys away mid-play - and they are put out of sight before the friend arrives.
This year, we are going to buy a set of playsilks for my girls, and part of the gift will be a dyeing party with Mommy! We also ask family members for consumable gifts, rather than toy clutter. FLYLady has some great ideas here: http://www.flylady.net/d/cruising-through-the-holidays/clutter-free-gift-ideas/ For several years, my parents bought us an annual pass to the local zoo. This year (they don't have much money), I am encouraging them to combine a gift card with a gift of time - a GC to a local restaurant, where they will take the child out to lunch; a movie pass, where they will take the child to the movies. Even a simple jar mix can be redeemed for a baking party with grandma!
Finally, we do a toy purge every year before Christmas/Hanukah/birthday season. All the toys get dumped into a pile, and we go through each one and decide Throw Away (anything broken, junky, or missing parts), Give Away (still in good working order but not played with), or Put Away. Their toys must fit into their toy shelf. The one time they complained, I reminded them that we only have a certain amount of room, and if they don't make room for new toys, they won't be able to get any.
