Towels shouldn't be artificially fluffed by fabric softeners; this makes them feel soft, but the fibres are less absorbent. I use a half cup of baking soda in the wash when I am doing a load of towels and washcloths. This helps ensure that the detergent rinses out completely, and it gives a fluffy, gentle feeling to the terry-cloth without impairing absorbency. I learned this from a "Heloise" column years ago. I've never found a better method.
Flimsy, cheap towels like the ones at Motel 6 really suck. Great big, thick Egyptian cotton towels are worth the extra money. I don't know why, but the pure white ones seem best to me. Must be psychological.