A rehash of previous year's Coal would work nicely for the device's fuel, but, it could give you a smattering of crates and, pretty rarely, a gift-package style item called:
"Christmas Crackers"
these borrow from a tradition in commonwealth countries [read more on: https://en.wikipedia.org/wiki/Christmas_cracker] but the gist is that you pull them apart, they make a cap gun pop noise, and there is a little toy inside.
leading into my following suggestions for what the "toys" could be, the intent of them being that they're just fun items:
-stack of Coal (hypers)
-Toy Kazoo:
"This little instrument can perfectly recreate all the music that the Ocarina can play!" -Kazoo Salesman
The Kazoo functions identically to the Ocarina. However, due to the fact that it is a lesser musical instrument, each one can only invoke one ocarina song, randomly rolled upon drop. Which one can your kazoo play? you'll have to find out manually...
-Bouncy Ball
The Bouncy Ball functions identically to how it does on the Bouncing Mayhem minigame round. However, due to the fact that FRG TTT is a game grounded in realism, you can only carry two at a time. Make them count!
-Dart Gun
uses model of https://cso.fandom.com/wiki/Dart_Pistol
revolver, has 5 shots, always comes with -99% damage stat but 1 in 1 Newton proc. funny nerf dart tracer
-Toy Lightsaber
uses the Beam Sword model sized down approx 75%
performs everything the beam sword can at 25% effectiveness (except deflection, because it is plastic.)
uses sounds that i will record making with my mouth if you actually want to use this idea brass

and finally, the Cracker's very rare godlike:
-The Hearthsword
model: https://cso.fandom.com/wiki/VULCANUS-9
"How did they fit this in that little tube!?!"
This sword functions as a normal melee akin to an uncharged star wrath at first, however, if you activate it with a combo attack, you will enter
"Christmas Fever" mode
The sword will ignite and people will have no choice but to look at you! you have the effects of the Valignatir sun, that is, people's gazes are drawn to you, but you are blindingly bright.
This is both an advantage and a disadvantage, for obvious reasons.
You will also take mildly reduced damage as a result and ignite people you hit with your sword's strikes.

And the Device unique:
The Snowblower
model: https://cso.fandom.com/wiki/Leviathan
Upon left click: Emits a pure cloud of cold that slows, eventually stopping the target entirely from moving their camera or player.
Upon right click: Shoots a Snowball that does minor (10-20) damage but slows the target for the entirety of the round by a small amount. Stacks.

Glacial [unlikely tier]
identical stats to how terranable rolls them, but with chance to get ice (non-snowbird ver.)

Gelid [Legendary tier]
Clip size very large (20~)
firerate very small (-35%~)
idea being that the tier has a lot of bullets to fire before it has to reload but it takes a long time to fire them

Scattersnow [Legendary Unique]
more or less a rehash of the scattershriek but with the inherent trait being the guaranteed slow trait as was on the Endurlock.

Droll [Primordial Tier]
Enhancable by kills.
Starts with all bars maxed out, forces you to make stats worse as you level it, EP only able to be gained if none is unspent. Gains a trait every 6 levels with a max of 36, at which point the stats revert to being full. Higher likelihood for the traits gained to be christmas related.

Block Blaster [Primordial unique]
model: https://cso.fandom.com/wiki/Brick_Piece_M777
Functions like the coal launcher in terms of firing and damage, but applying stacks of "Lego walk" to victims. These victims, upon walking while afflicted, will constantly emit HL2 citizen pain noises and take very mild damage. usually come with other traits and dots at a high procrate.

Christmas Challenger [Crate Godlike]
utilizes the christmas version of this model: https://cso.fandom.com/wiki/JANUS-7
Can be charged by damaging players, upon proc, you can use L+R click to shoot out a snowman head projectile. Whoever it hits is phased out (with you) to the Realm of Joy (the rift but more cheerful). Whoever emerges victorious from the battle will find their health and ammo replenished as well as being "Snowman Teleported" to a random location on the map.