T.H.
I think you could probably just make it by doing a little fancy work with some rectangular cake pans. Instead of baking the cake in a round pan, put it in a rectangular pan and bake 2. Use one pretty much as it, but maybe cut a little bit to make it look like the stove-pipe part of the hat. Take the other one and cut it in half lenghtwise and shape it to look like the brim of the hat. Then you can make the stripes with the frosting. I would put a base coat of white frosting over the whole thing to both keep the two pieces kind of secured and make a palette for the rest of your frosting.
If you want to get really fancy...you could bake multiple round cakes and stack them super high. You could even do them in red velvet and white with red/white frosting so it's double layer striped. This would make a more 3D look, where the other is more 2D, the only problem I woudl forsee is that you couldn't get it as tall as you'd like before it might start to tip.
Last idea...for the really ambitious...make cupcakes for each person using regular size cupcakes and mini cupckes. Do one regular size and then stack two minis on top, held together with frosting and then frost the whole thing to look like the hat.
Just some quick ideas from my head...hope they help to get you inspired!