There are so many free dishcloth patterns on ravelry. My favorite is by Debbie Andriulli... you can find it here... http://www.ravelry.com/patterns/library/waffle-knit-dishcloth. The pattern is a great way to practice knitting and purling. The result is a wonderful dishcloth. I recently made a bunch of these as a birthday gift for a couple special family members.
I packaged them up in a glass jar from Ikea, along with an embellished dishtowel. A cute gift for 2 ladies who have everything!