Choosing guest towels in linen has a couple of clear benefits. Linen is easier to keep in good condition as the linen fibres become stronger when wet - they're also completely fine when boil washed. This means that in the long run, you end up spending less on towels, and they look perfect for longer.
They're smaller than hand towels to cut down on laundry volume - but it allows for individuals to have their own towels (which is especially useful when hygiene is of extra importance).