Baum considered this his best work. I'm not certain I agree with him, but it's certainly one of his strongest. If you overlook the names, which get a bit unfortunate in places. A light-hearted thing of fancies and fantasy.
It opens with a court of fairies where the queen does not want to dance. Discussion of the problems of boredom leads to the idea of enchanting something. Finally, they decide to make a cloak that will grant one and only one wish to a person, unless he got the cloak by stealing it. One fairy sets out to give it to the first unhappy person she meets.
Meanwhile, two little orphans, Bud and Fluff (yeah, those are the names -- they are really named Timothy and Margaret), are being taken off to the city by their Aunt Rivette, who goes for corporal punishment. Fluff is very, very, very miserable, and so gets the cloak. Shortly thereafter, she wishes she could be happy again. And the wish works.
And in the city they are going to, the king has died, leaving no heir. Finally, his councilors remember the book of law and read they must crown as king the forty-seventh person to come in the gate after dawn. Which, it proves, is Bud.
Three episodes ensue. Bud being king -- in a style that many young readers would think an excellent way to be king, though Fluff does persuade him that he has some responsibilities -- and the cloak going from hand to hand and people making wishes without even knowing it granted them. What Queen Zixi of Ix did when she learned of the cloak and its powers. And one more that would be a bit spoilerish. Involves an alligator that wants to climb trees, subjects who fear Queen Zixi more than they love her, wings being useful for scouting, soup, buying all the toys they could want, an attempt at a witching school, and much more.