To make cranberry-flavored vodka, in a 1-1/2-quart saucepan combine 1 cup cranberries, 1 cup granulated sugar, and water. Bring to boiling, stirring until sugar dissolves. Continue to cook just until cranberries start to burst. Remove from heat, cool 30 minutes. Strain cranberry mixture, reserving cranberries and liquid. In a large glass pitcher, combine vodka, reserved strained cranberries, and 2/3 cup of the reserved liquid (discard remaining liquid). Cover and freeze for 3 days.
Strain cranberries out of vodka; discard cranberries (you should have about 4 cups vodka mixture). If desired, place some Vanilla Sugar on a small plate. Dip rims of eight martini glasses in water and in Vanilla Sugar to coat rims; set aside.
Place ice cubes in a martini shaker. For four drinks, add 2 cups vodka mixture; shake. Strain into four of the prepared glasses; repeat. If desired, garnish with additional cranberries threaded onto small skewers. Makes 8 drinks.
Fill a quart jar with sugar. Place both halves of vanilla bean in sugar. Secure lid and store in a cool dry place several weeks before using.