The kitchen towel keeps the crust from hardening. You don't want the crust to harden until after it's in the oven. And for this recipe, you want to make a crisp, crackly crust. Johnson achieves that by misting the oven with water to make steam and with a baking stone, which is preheated to simulate the brick-lineovens in which artisan breads are baked. Baking stones draw out moisture from the crust as it cooks, making it crisp.
Stones are flat slabs, often round because they are so excellent for pizza crust.
Look for them in kitchen and department stores. The only thing you have to watch is that they don't go from hot to cold quickly, which might crack them. Preheat stones in a hot oven for about 45 minutes. Loaves are slashed after they have fully risen and just before going in the oven to release interior steam that will otherwise blow out a side or end of the loaf. Use a single-edge razor blade or a really sharp knife and cut quickly.