Each team should get one of each type of flag, glyph, wand, belt, and potion. (It's up to you whether duplicates are permissible. Some items are more valuable than others, so you probably want to be careful - extra Long Wands of the Law can't hurt, but extra Goombah's Belts would almost certainly be a Bad Idea. When you have 60 people on a team, four wands and four belts will probably not be enough. :) )
This game is meant to be played indoors. Lurking in hallways, finding unexpected things around corners, and putting glyphs on doors are all integral parts of the strategy. An outdoor version would take considerable fiddling. Any takers?
For the sake of sanity, you should have a central room in neutral territory where the head judge will preside. He can answer questions, resolve disputes, and so on. The players wouldn't mind if there were cold drinks there, either.
If you have enough spare people, it is also helpful to have some field judges who wander around and follow the action, so that questions can be resolved more quickly.
All this nonsense obviously takes a lot of familiarity with the rules. It will probably take even more tolerance to play "at speed". Pay attention to people; see what magic items they're carrying so you won't be surprised if they seem to violate the rules.
If it impossible for you to know something, don't worry about it. For example, the Potion of Truth may only be used once per jailbreak; but if you come across one and don't know if it's been used recently, assume it hasn't. Make every reasonable effort to tell people about time limits and countdowns.
Every player should wear a watch.
Cut the pink and yellow squares of felt into 18-by-18 inch squares. Set aside three squares of each color to be the flags of each team. Label each team's flags "A", "B", and "C". Cut the remaining quarters into armbands, 18 inches by one inch, which the team members will wear to identify themselves.
Cut the orange felt into yard-long strips, and tie pairs of strips together to produce eight orange belts, each about five and a half feet long. Add bands of colored cloth tape to form two of each kind of belt. (You could just use red, green, blue, and brown felt, of course, but this is a little easier. I used orange because it's distinct from the team colors and the other colors significant in the game.)
Make up two of each kind of glyph, and color the borders with the highlighter pens to indicate which team owns each. Make sure there's enough color to be recognizable from down a long hallway. (You were wondering why the teams are yellow and pink? Those are the highlighter colors I found. You could make the glyphs on colored paper, if you wanted to be fancy. You could rearrange the entire color scheme if you wanted. Just make sure the team colors and the magic colors are all easily distinguishable.) Attach one of the stopwatches to each glyph. (This way each glyph knows about Official Game Time, and players know when they may move a glyph.)
Cut the pipe insulation into eight 2-foot lengths. Put bands of colored cloth tape around each length to make the eight wands (two of each type.) Four bands of tape per wand is good.
Put a band of colored tape around each foam ball. We couldn't find foam balls in time, so we took eight 1-foot lengths of pipe insulation, bent them into doughnuts, taped them that way, and added more bands of colored tape.
Allow at least half an hour for all this construction foofaraw, plus another half-hour (hah!) to go over the rules and pick teams.