R.R.
Have done it, it was great.
Do not have children there, they will want to play with everything and if they see their toys there they may want them back.
It was permanent, I don't know how we could have guaranteed getting something back, and it not being broken or worn out.
We decided what we felt things were worth (three moms and a dad did this when someone brought toys in, they were fair) and had tables set up for $1, $5, $10, and $15 tops, regardless of how much you paid for it, it depreciates once your child put their hands on it and used it ;) So each person got a voucher for "x" amount of toys and "shopped" for that amount. Say a parent had $15 "credit" they could choose one $15 item, three $5 items, or whatever equaled the amount they had. No one was upset, we knew we didn't have to buy new toys, and if it broke, well, that happens with new toys, too. No one complained.
There's even an online toy swap,
http://www.toyswap.com/