I have no clue why she’s doing it, but maybe if you wash the towel and put it away, she’ll stop. One of mine gets in the bathroom trash, picks up some toilet paper in her mouth, stops and drops it every so often and “cries”. We think she wants to play, as she fetches if you throw balled up paper for her. She also seems to lose us when we go to bed. She’ll wander around crying until I call her into the bedroom.