I just found this post from Kindergarten Rocks and loved the idea!! It's Body Spelling from Dr. Jean. It's a great way to involve the whole body when doing word work and practicing sight words. You will find a free download for individual student recording sheets and picture icons for whole group work from Kindergarten Works' post Body Spelling with Dr. Jean and Friends.
Dr. Jean's Better Bodies and Brains: Let's Get Moving! CD is loaded with fun songs for practicing literacy while getting the body moving and engaging the brain.