Picked this up last night by playing around with a few things and it seems that there are three main things you need to do.
You want to be in create mode and place a random person in - I just chose the male woodland peasant as it was the first one. Then you want to hold
while highlighting it and press
to enter the character studio.
There are four main areas: kinect recording, character, clothing and attachments. The three you need to change are the last 3.
Character: Go in and change any setting for the character like giving them a beard or making them bald.
Clothing: Edit any form of clothing, or just remove pieces entirely.
Attachments: Add any prop i.e. acorn or cannonball and proceed to add it to the characters. Make sure you attach it to a body part, I chose head because it was clear I had added it.
That should be the requirements, let me know any different.