In order to have a nicely folded cloth napkin, one must begin with a good quality napkin in the first place. It is absolutely impossible to get all of those little creases and folds just right when the napkin itself is not sewn properly.
So, if you are going to go through the trouble to host a dinner party with cloth napkins, make sure that you can get a decent set. It doesn’t have to be the hundred dollar a piece French variety, but a moderately priced, linen set will work nicely.
Having a good quality item to work with makes folding a napkin much simpler.