1. Cut 3 sheets of 8-1/2 x 11-inch paper into quarters to make a total of 12 pieces. Trace a 2-3/4-inch circle onto each piece of paper. On each circle, draw hair, plus facial hair and glasses, as desired, to resemble a family member's features. Cut 12 same-size squares of wax paper, one to cover each drawing.
2. Place each color of melting wafers and the butterscotch chips into separate quart-size, freezer-weight, resealable plastic bags. Microwave one bag at a time on high, rubbing sides of bag together every 15 seconds, until wafers are combined and melted, about 1 minute. Place paper drawings on a sheet pan. Cover each drawing with a piece of wax paper. Snip a small corner from each of the bags, and trace over the outlines of the hair, facial hair, and glasses, using colors of your choice. Fill in with additional chocolate or butterscotch. Place tray in the refrigerator for 3 to 5 minutes to set.
3. Spoon 1/4 cup of vanilla frosting into a resealable bag, and snip off a small corner. Tint remaining frosting a pale pink with a few drops of red and 1 drop of yellow food coloring. Spread cupcake tops with pink frosting as smoothly as possible. If your family is darker-skinned, use either milk- or dark-chocolate frosting instead of tinted vanilla for frosting cupcakes.
4. Carefully peel chocolate pieces from wax paper, and arrange on cupcakes. Using bagged vanilla frosting, pipe 2 small dollops for eyes. Top dollops with candy-coated chocolate pieces; also use these for earrings. Use jelly beans for noses, cereal for ears. Pipe on mouths with the red-tubed frosting. Using bagged vanilla frosting, pipe small white crescents on the eyes.