Outdoor space: They liked the simple look of the famous Willow Tree nativity so they literally upscaled the figurines to 7x their original size and built them out of paper mache. For the trees, they took branches that had been trimmed off of large trees and built them into bases to stand them up.
The deck: The desk was simply built out of wood.
The fireplace: They built the fireplace out of styrofoam, put a hard coat on it, and painted it. They used an LCD TV with a fireplace video loop to create the flames.
The living room: They built the staircase mostly using 1x2s, 2x2s, and luan. Definitely not weight bearing!
Get a better idea of the project from the time-lapse video at the bottom of this post.