100% Cotton or a Cotton blend works well for both knitted and crocheted washcloths. We collect these all year. It's an item always needed at the shelters, and is very much appreciated.
The family shelters, both Faith Mission and The Homeless Families Foundation provide packages to the families as the depart shelter living into "their home." Washcloths and dish clothes are always a part of these packs.
Sizes and colors appropriate for adults, as well as children; but primarily adults are needed. The adults who live outside in the elements (primarily men) are also given these cotton wash cloths, so manly colors are needed as well as the more traditional pastels and brights.
I suggest nothing smaller then 6 inches and 8 inches or larger for the men.
Not much yardage is needed to make a cotton wash cloth; might be a nice way to use up your stash; but please if you mix your cotton stash go with stripping so it's not obvious you've run out of fiber.