Actually I'm using another typeface (Textile) just for letter shapes, to which I gradually add weight, I think I could get away with that, the result is nothing like the original anyway.
I was thinking of making a typeface which kind of looked like clouds, right now it reminds me of something food related.

Btw, here's another trick which I did with Helvetica
Type some number of uppercase letters with uppercase letter I beetween each letter, such as
K I V I E I L I D I U I L I F I R (Kveldulfr)
Create outlines > Blend: Options > Steps: 1 > Blend: Make > Blend: Expand, then delete the original outlines
Kind of fun, hehe

This example didn't turned out well, but this is what I would usually do, see the attached file in my first post (Untitled-2.gif).
I'm using Adobe Illustrator 9.0.2, and all the functions I refer to are all built-in

1. Here I start with letters "KMB", I'm using Textile as I mentioned, 144 pt.
2. I cut the letters with the knife tool in "joining" and "bending" points on the glyphs, it is rather important to cut in the right places, I always fail on this and go back as it is difficult to see what those places are.
3. Roughen, size 5, detail 15/in.
4. Round corners 20 pt
5. Offset round 15 pt, note the tiny "crusts", those are actually produced by the Offset function, I wonder if newer versions of Illustrator will have the same effect.
6. Outline (from Pathfinder)
7. Clear all the lines which shouldnt be there, you may need to cut some of them

Tada