Over a year or so I've tried to wash the towels in different groupings and have finally settled on:
1) Glass towels - always wash by hand in the sink, the towels will avoid picking up any lint this way, will smooth out by hand on the counter and then hang to dry on a rack
2) Utility towels - will usually wash by hand in the sink but if I have enough will run a load just for them, will hang to dry on a rack
3) Everything else goes together in the washer (great white, waterless wash, single soft, double soft), dry most of the way in the dryer and then hang to finish dry on a rack