I've "made" a rain kilt out of a garbage bag with integrated drawstring. No sewing required, just a pair of scissors. I got the basic idea from The Complete Walker. It works surprisingly well, though there will obviously be some durability issues. I use a twist tie to hold the drawstring in place, as a belt.
I think that a non-breathable fabric is fine, because there's so much air flow up through the bottom. The only exception is right around the waist, where the fabric is pressed up against your shorts or pants.
I've been interested in a getting a silnyl or tyvek rain kilt, but could never find one for sale, and I don't sew. The Etowah Rain Wrap, which Mark pointed out, looks good, but I can't find it for sale anywhere online. I'm surprised that none of the other small ultralight gear companies have made anything like this.