The Ugly Dishcloth pattern: Tunisian Short Row Dishcloth (and some links)

http://www.hookedonneedles.com/2009/02/tunisian-short-row-dishcloth-video.html

Here's the pattern I used. You can Google Tunisian Short Row and get both the dishcloth and larger baby blanket versions.

http://www.chriscrosscrafts.com/free/dishclothes.htm

And this one looks kind of neat...
http://www.mielkesfarm.com/diagonal_hotpad.htm

http://serendipity.gpvm.com/dishcloth.html

Here's a collection of linked patterns:
http://dishandwashclothmania.com/grandmas-favorite-dishcloth-knit/

http://www.ericalea.com/2009/05/28/not-your-ordinary-knitted-dishcloth/

http://scrunchyy.typepad.com/fiberadventures/2007/10/free-pattern.html