Anyway, I have no proof, but I think yo-yos were another product of the Victorian era, those lovely, idle ladies who were looking for yet another way to decorate with fabric. The early ones were probably made of silks and velvets, like the crazy quilts.
Yo-yo quilts are not really quilts in the traditional sense. The yo-yos are sewn on top of a backing fabric which shows through the yo-yos. Sometimes, the yo-yos are stitched together without a backing and used as a coverlet.
This would be an example of yo-yos used as a coverlet, just imagine that the expanse of your bed is covered with these, with a white or ivory sheet underneath.
Now, imagine that you wanted a more dramatic backing. You could sew the yo-yos to a darker fabric, or maybe a rose color in a little girls room. Imagine how feminine these would look done in pastel florals, sewn to a pink background.
In the 1970's this craft became popular again. I've seen them made into sleeveless vests worn over turtleneck sweaters. I've seen them covering throw pillows. If you dig through your memories, I'll bet you can remember a grandmother or aunt that had these pillows. Lately, I've seen them made into purses and used as a brooch or decoration on a purse. And of course, there are animals. And clowns.