I've ben using a muslin sleeping bag for dd and I love it. I don't think it's tog rated (we have tog rated ones for cooler months) but I'm fine with that for the warmer months, especially as we co-sleep. I got it from aden and anais. I bought online but myer at southland stock them.
We use the same and they are awesome, they also come in thicker muslin for the winter or if your aircon is on too high!
slumbersac's are great too, and a lot cheaper than grow bags.
you can get them on ebay from the UK and they arrive pretty quickly.
i put DD in hers from about 8weeks i think, she hated being wrapped
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