This was so much easier than I thought it would be. Once I had a stack of cloth napkins ready, it was simple. Now I have a separate laundry basket for my napkins and dishtowels, and it's EASY! I'm embarrassed I hadn't converted to cloth sooner.
2013 Update: I'm still completely on cloth napkins and dish towels at home and at the office. I haven't purchased paper napkins or paper towels since December of 2010! Love it!