Exhibition #3, curated by Sir Peter Blake, The Museum of Everything, London

There are surreal pleasures to be found all over Britain. Old amusement arcades in seaside towns, cranky ghost trains at funfairs and stuffy, outdated museums can appear wild in their sideways creativity. It is these objects – spooky, hilarious and made outside the formal world of art – that are explored in the Museum of Everything, a pop-up exhibit drawn from the collection of James Brett, a collector of outsider art, that opened in Primrose Hill last October. This week it was announced that the museum will stage its inaugural run in Russia, at Dasha Zhukova's Garage in Moscow, next year.

For Exhibition #3, the museum has invited the elder statesman of pop art Sir Peter Blake to curate an exhibition based around his own collection. Blake is clearly a kindred soul to the museum and his warm tone is present on hand-written notes around the space.

You enter to a hall of wonky mirrors and are led down a passage featuring archival images of Victorian circus "freaks" – giants and dwarves. There are huge collections of fairground art and beautifully hand-painted but creepy Punch & Judy puppets, and extensive model railways. There are pressed flowers and tourist tat boxes covered in tiny shells.

A Blake wall text says: "It's amazing isn't it? When you see something separately it becomes extraordinary." He is right. The artists are treated gently.

The works that are endlessly intriguing, however, are those that create a slight discomfort – a reminder of the fact that this is a country of odd traditions and nostalgias. Two rooms stand out.

The first is a room of work by Ted Willcox, a Second World War rear gunner who later took up long-stitch embroideries as a kind of therapy. Willcox created brightly coloured and bounteously soft tapestries depicting hallucinatory images of topless pin-ups that he copied from magazines such as Titbits.

The models are depicted in states of abandon but what lifts them out of the ordinary are the psychedelic backgrounds that make them appear wild but also strangely flat – woman and background are one in a sea of exuberant colour.

The other highlight is the room featuring the work of Walter Potter, an eminent Victorian from Sussex who created taxidermy scenes in glass cases. Alongside a pet pug and a two-headed sheep are detailed dioramas featuring animals acting out stories or rhymes. Squirrels drink and play cards, while "The Athletic Toads" play games. Damien Hirst has leant a suitably creepy scene, "Happy Families", in which cats, dogs, mice, rabbits and birds sit together as friends.

It is easy to forget how familiar we are with the way we think contemporary art should look. Calm and restraint dominate our galleries. It is strangely liberating, then, to have this style challenged and to remind yourself that while this is a country often at the cutting edge of things, it retains many old eccentricities. Creativity does not always come wrapped in the package we expect.

To 24 December (www.museumofeverything.com)