What's a good $50 gift exchange idea for a co-worker?

That is a lot of money.

Get a GC to a local restaurant.

A gift basket specialized to their interests is a wonderful idea...you can either find a store that makes them or make it yourself--you can get really creative and I promise the person receiving your gift will appreciate the time and thought you put into it. Some examples...if your friend likes golf, you could put in different golf accessories, maybe free round of golf tickets (depending on price), golf balls, a book about golf, etc.

or...if your friend loves wine, you could could put in a couple of bottles of wine, perhaps some special wine glass charms that help guests differentiate between their glass and someone elses, a book about wines, etc....the possibilities are endless and you might find this to be the most "fun" gift you give this year :)

Gift cards are impersonal

i would just get a $50 gift card, that way whoever gets it can buy what they really want =)