HI, I have seen many things about using a paper towel to smooth a cake. HOW do you do this? and why would you do this? Many thanks!

Here's a nice tutorial with photos:
http://cakecentral.com/articles/71/how-to-create-faux-fondant-the-paper-smoothing-towel-method-viva

I don't use the soda bottle "device" - just my hands and a fondant smoother.

As to why you would do it, well, once you've got the technique down, you get super smooth buttercream in no time at all.

Viva Paper towel, fondant smoother, or some use their hands instead of the smoother I know. After the final smoothing wait till the buttercream crusts over,and Just place the paper towel on the cake and gently rub with the smoother, takes out any bumps, lumps, spatula marks, and gives you a look of total smoothness like the look of fondant. I wouldn't ice a cake without it. BUT!!!! you have to have a buttercream that crusts! There are some that use a small spong paint roller to acheive the same effect. I have not tried it, but will as soon as I remember to buy the roller!!! Is any of this clear? Sometimes I have trouble making my point. Yikes!

It really does work! I never liked the way my buttercream cakes looked, so I pushed fondant, but after trying this, I'm much more confident about a plain crusting buttercream cake. Looks very smooth and professional!