I had a little girl in care who used her blanket as a soothing technique like this while she was falling asleep and I'm pretty sure she started doing it right around age 18 months. It took me a long time to realize what she was actually doing, then I was flabbergasted! I didn't ever bring it up to her Mom because I didn't know what to say. However, this little girl only did this while falling asleep in her playpen once a day at naptime and nobody ever saw her do it but me. I had no idea little girls did this and I couldn't believe it! But she was fully clothed and her blankie was under her just bunched up.
However, I have a friend who has a little girl in her daycare who uses her hand and is very loud and actually wakes the other children. Now I would not be able to keep this girl in care I don't think because I would be really, really freaked out. My friend has had this little girl in care for several years and she actually has run into problems and accusations now that the girl is in school and daycare every other day. Now that is scary!