LAST DECEMBER, Susan Bush made a flock of China silk birds and set up a vending table on Connecticut Avenue. She hoped to sell enough to go home to Denver for Christmas. She didn't.

I got too cold. I can't stand retailing my work.Especially when I'm freezing. I was the biggest Christmas grump on the avenue. I finally did get to go home, but no thanks to the birds."

Bush does better with backpacks -- wholesale. Bush and her assistant (since May) Corine Conners made 800 fancy backpacks last year, plus wallets and other small bags. "I got tired of drab backpacks, and so I figure everybody else was too. I use bright colors of canvas. And I paint on them with thread."

Bush uses the label "Sugarbush" (her daddy called her that) and "the thread fairy" for her "Colorpacks" -- backpacks decorated with appliques suggesting old U.S. 40, lightning bolts or far horizons. They retail for $36.

Bush is one of 330 artisnas who will be exhibiting their wares Wednesday through Sunday at the American Crafts Winter Market at Baltimore's Civic Center. The first two days of the show are for retailers only. The show is open to the public Friday through Sunday from 10 a.m. to 6 p.m. The Baltimore show is a good excuse to take a look at crafts workers today to see if they're happy and making a living.

Bush thinks she's doing pretty well for a crafts worker. For two years, she's made the rent ( $130) on a studio in Beverly Court on Columbia Road NW. She and 15 other tenants have been trying since July to buy the building, probably Washington's most famous artists' quarters. Last year, she says, she grossed $16,000. After she paid herself $200 a month, a small salary to Conners and $4,000 worth of new sewing and cutting machines, she was $125 in the hole.

"I can make it though," says Bush. "But I sure would like to be able to afford some clothes." She pays $80 a month rent for the apartment she shares with a friend. "That leaves me $120 mad money. I'm a big eater, so I budget $100 for food for the month."

Even so, Bush enjoys the pleasure that comes from watching an original idea grow beneath her hand.

"I've made bags all my life," she says. "When I was in grade school, I sold my bags to other students. I was the haute couturier of the sixth grade."

She didn't go straight into crafts, though. She studied piano and theory at the St. Louis Conservatory and Colorado University before going into fiber arts. Now "pushing 30," she feels as though it's coming together. Since a showing of her work at the Rhinebeck (N.Y.) Crafts Fair, she has commissions from "the Virgin Islands to Alaska." Locally, her work is at A.D. Smull Gallery, the Smithosonian and the Renwick Gallery. "I haven't tried to get too many outlets here, because I've always been afraid I'd have to go out on the street to sell my work and I don't want too much competition."

Michael Dixon will sell his laminated wood kitchen wares -- cutting boards, boxes, rolling pins, bowls -- at the Baltimore market. He sells about 90 percent of his production at craft fairs "from Florida to New York to St. Louis." Only about 10 percent make it to shops. "It's better for the customer to buy directly from me. My materials and labor cost so much, the price is too high to have a retailer's profit tacked on top."

Dixon is a production craftsman. He doesn't think of himself as an artist. He has a staff of two or three, but "I don't sit in the office counting the money, I work along in the shop with them."

Dixon did a tour with the Peace Corps in Peru, then took a degree in international business. He worked awhile with a lumber mill in Nicaragua, and then with a lumber company in Maryland. In 1973 he set up his own hardwood lumber yard in Brownsville, Md. For his woodworks, he uses "colorful, rare woods, those that are too prohibitively expensive and exotically patterned to use for furniture."

Rufus Jacoby of Silver Spring plans to sell his dulcimers at the Baltimore show. But dulcimers weren't his first craftswork. For many years he taught silversmithing and other arts at Calvin Coolidge High School and Catholic University, among other places. "I saw my friends retiring from their jobs, and I thought, 'I'll never get weary of silver.' But I did."

"I sat in my recliner for six months, thinking about what else I wanted to do. And then I decided to do research on dulcimers. I've always made sculpture, for my own pleasure, and dulcimers seemed akin to sculpture. They remind me, too, of the silver chalices I used to make."

In the last three years, Jacoby has made 300 dulcimers. He hasn't sold them all, not by a long shot. "I'm not trying to make a living from them," he says. "I make the dulcimers for the satisfaction. I am an indifferent huckster. I sell them mostly by word of mouth." The dulcimers sell for $150 to $275 in rosewood and other exotic woods.

Recently Jacoby was honored when one of his dulcimers was chosen to be exhibited in the musical instruments show at the Renwick Gallery.

Jane MacKenzie makes alligators that serve as coffee tables, lions and tigers to prop up your feet and rams to rock on. Since she took her fierce beasts to the Rhinebeck fair, she's acquired enough commissions to move her shop out of the room off the parlor room "and get the sawdust out of the house. I didn't realize how bad it was until I got the woodworking out." A good thing too, since she needed the room -- she and Washington artist Brockie Stevenson were married at Christmas.

She's rented a shop in Georgetown and hired an old friend, Mac Turner, to work with her. In Baltimore they'll show the whole menagerie. MacKenzie, like Dixon, is a production crafts worker. She has her set designs. She and Turner make multiples of each animal, depending on the orders.

These four are among the 330, selected by a jury from 1,100 artisans who submitted slides of their work. They pay $200 to rent space at the show. In 1977 about $750,000 in crafts objects were sold at the Baltimore show. Last year the gross was $1.5 million, according to Paula Rome, spokeswoman for American Craft Enterprises, an affiliate of the American Crafts Council, which runs the show. About 32,000 people came last year.

For the public, crafts fairs have the excitement of an oldtime village fair. You actually can speak to the person who made the object. Tell him how much you like it, or ask her why the heck she put that doodad on it.

Amateurs find the fair an opportunity to ask the masters questions and see how others solve design problems. Many of the artisans work in isolation, in small towns or up country, so the fairs seem festive to them, too. It's their chance to see what other workers are doing (maybe steal an idea or two) and to ask customers why they like this box and not that one.

They're a great sight, sitting in their booths, many as draped with objects as a Moroccan stall, nursing the baby, eating apples, working on a rug, playing the guitar, telling tall tales and counting their money.

The Baltimore fair, is, of course, no isolated event. Almost every week there seems to be a crafts show some place in the Washington area.

Peter O'Shaughnessy and Nol Putnam, both blacksmiths, and Jon Kuhn, a glass blower, who are in the Baltimore show, also are exhibiting at the Greater Reston Arts Center through March 11. The show is "The Elements: Transformation Through Fire," an exhibit of clay, metal and glass, all materials which use fire as a tool. Others in the show are Margie Jervis, Susie Krasnican, Eric Laidlaw, Betty Helen Longhi, Doug Quinn, Carol Ridker, Eleanor White and Ronald Wyancko.

The Potomac Craftsmen Guild is exhibiting recent works, "The Art and Craft of Fiber," through March 24 at the Textile Museum. The Art Barn, Tilden Street NW at Rock Creek, has a show of arts and crafts every week. The Torpedo Factory on the waterfront in Alexandria is a perpetual show of work in progress, as craftsmen and craftswomen show and sell from their studios.

In recent years, a new breed of crafts workers has emerged -- the production people whose principal sales are not to small craft shops but to big department stores.

Peter Petrie is one of these. Petrie was in town recently to give a demonstration at the Bloomingdale's stores here.

He's the Big Time -- by craft standards. He, or the seven women working for him, make 300 or so mugs a day in 24 different sizes and shapes. The mugs all have the same face, rather funny and drunken-looking; the droopy cross eyes almost hit the bulbous nose and the spaghetti beard. Petrie likes to think the face looks like him.

Art they are not, but Petrie doesn't mind making thousands and thousands of them, especially since he grossed $300,000 from them last year. He hopes to double that figure this year. The mugs sell for $8-$8.50 retail. Wholesale is about half that.

Still, his utilities cost him $400 a month -- that's for the seven electric kilns that fire his production. He has half of the second floor in an old button factory in Portsmouth, N.H. Other artists/craftsmen, a sign maker, a leather worker and a sculptor, also work in the building.

Petrie likes to say that he wasn't even breaking even in a studio in New York. Then he met the waitress in the restaurant next door. Susan Clemens told him, "What you need is a business manager, invoices, account books, bills of lading." Petrie says, "All I wanted to do was make pots to make enough momey to travel and cook." Clemens took over the paperwork three years ago, and the profit has gone up every year.

Petrie is 44. He worked 10 years on a General Motors plastics and Fiverglas production line when, he says, his reght lung collapsed and he lost the use of his right arm.

Out of work, and unhappy, Petrie had a flat tire by the Pewabic Pottery in Detroit. He went in to use the phone, became fascinated by the work, bought 50 pounds of clay and started to take lessons. He later bought his teacher's equipment and set up as a potter. On the proceeds he went to Europe, studying in Spain and on the border of south Wales. When he ran out of money, he worked as a cook, mostly, to hear him tell it, for movie people. He specializes in Polish and Russian cooking.

After Europe, he came back to New York City, where he met Clemens. Now Petrie and Clemens are married, and they've bought an 1815 house with a captain's staircase (like the ones on the old sailing ships). They've turned it into an inn, giving bed and breakfast.

Once in a while, when he can spare the time from cooking, innkeeping and making mugs of money, he makes a few political ceramic cartoons. These, with sometimes rough humor -- such as a session of Congress in the rest room -- have been exhibited in Montreal.

How many craftsmen are there in the United States today? The answer seems impossible to determine. The National Endowment for the Arts researched the question in July 1977 and came up with the view that "not enough information was available even to begin such a survey."

The American Crafts Council (ACC) has about 35,000 members across the country. But obviously not all crafts people are members. The endowment, using figures from Marietta College in Ohio, publishers of a crafts directory, think there are about 1,692 crafts organizations in the country. From these and other figures, the endowment's best guest is 350,000 artisans. A survey by the ACC suggests that more than 30 percent of crafts workers are potters, 25 percent weavers, 18 percent in metalwork, 8 percent in stitchery and 6 in woodwork. The rest work with textiles, enamels, glass, leather and book-work.

Maxine Brown, who established the Craftsmen of Chelsea Court here about eight years ago, believes there are about 700 shops across the country specializing in crafts."That's the number on the mailing list for our National Association of Craft Retailers. But it doesn't begin to reflect the enormous number of outlets for crafts that exist," she says.

"Things are so different from when I opened my first store. Then it was hard for the craftsman to find a place to market his wares. And just as difficult for the retailer to find a craftsman who would deliver the orders on time.

"Since then, crafts have grown up. Today the work is of much higher quality, and the craftsmen are much more businesslike."

Elena Canavier, arts assistant to Joan Mondale and former head of the Arts Endowment crafts program, says she thinks crafts today "are much more sophisticated. The crafts people are much more astute. They've learned it isn't enough to do your own thing and enjoy the crafts lifestyle.

"It's still true that there are two kinds of crafts workers. And a person has to decide which he is: a production craftsman, who makes many multiples of a few designs, or an artist/craftsman who makes one of a kind.

"Today, we're also seeing a return to the division between design and execution. Ronald Pearson, the silversmith, was telling me the other day that his apprentices in his Deer Isle, Maine, studio are content to do the work, leaving the design to him.

"We may be getting over the snobbish view that the design is everything, and admitting how much value there is in the execution.

"The other change we see is that craftsmen have learned to be businessmen -- those that survive. They've learned about deposits, packing for shipping and invoices and deadlines."

Not all crafts people want to sell their work. Not long ago, at a meeting of the endowment's council, there was a touring exhibit of 11 quilts made by residents of southwest Mississippi. The quilts were not for sale, just to admire. The quilts are in strong, splendid colors and patterns worked in long strips in the African manner, rather than the more familiar squares. One quilter told Roland L. Freeman, who collected the show, "I don't make anything fancy, just something to keep you warm." They are, of course, much more. The quilts are a true indigenous art, made by folk for their own use, to suit their own taste, not influenced by the needs of the market place. As such they are an invaluable record of a specific culture.

With all this, it must be said that the greatest growth in crafts must be in craft classes. The Smithsonian Associates conducts packed classes in all sorts of familiar-to-obscure practices, from gilding to woodworking.

Recently, Carolyn Hecker, the Washington representative for the American Crafts Council, set up a series of master classes. Almost all the 112 classes have standing room only. Hecker has a mailing list of 2,500 Washington people interested in crafts. She hopes soon to open the Greenwood Gallery, with a craft shop, gallery and studio/workshops.

Crafts are spreading out from the traditional pottery and weaving. Recently a Washington Guild of Goldsmiths was organized with Gretchen Raber as president and 50 to 60 members.

Crafts people are no longer thought of as long-haired dropouts in sandals and granny dresses, making rough primitive pottery on the top of a mountain. The craftsman and craftswoman today is just as likely to be the graduate of a crafts program in a university and a small businessman with a bank account and a large investment in equipment.

Today's American crafts workers are no longer pioneering in a new field. They have the the advantage of a large number of master classes, museum exhibits and a community of colleagues.And their work is not only accepted but sought for in the market place.

As a result, craft objects today are of far higher quality than 10 or 15 years ago. Multiples-by-production have brought prices down.

And here and there, if you have the money and the time, you can find the rare craft object that is a true work of art.