Holding dessert, directing traffic, or frustrating a recovering dog, What am I?

I hold a bright rainbow right in your hand. I am not a crystal, I am soft and I glow, I catch every color the sunlight can throw.

An early human cousin once had me, And I've been relied on ever since, Mounted on a mast I've toured the seas, And together we harness the winds

I'm soft and squishy sometimes I'm made with fur sometimes I'm made with velvet some times I have rubber soles but you never wear me outside I'm perfect for all ages but only older folks, adults and teenagers wear me to bed

Feathered yet I’ll never fly Upon me do the weary lie You’ll need me often in the night But rarely I’ll be used to fight!