I thought about using white insulation foam (iso). It doesn't expand too much, it's solid enough to fill the cracks and it'll still have a bit of 'give.'
You'd need to be pretty good with a sewing machine to make a cover from vinyl but it doesn't look impossible. I'm not sure about how much stretch or durability other fabrics will give you. Good UV-protected vinyl isn't all that cheap, but it requires very little care.
I had thought about flocking my dash, if it's too far gone to save.