i use terry flats for DD, with a Snappi and a cover from Big W (they're only about $4 each). I use disposable liners (box of 100 from Woolies for about $3), I find they keep her skin a lot dryer, rather than being right next to a wet nappy. She hasn't had nappy rash yet, apart from a very mild patch when she was younger which cleared up by the next day after putting some cornflour on it).

I can't remember the website I found with a heap of different folds, but at the moment I fold the nappy like a kite (so two diagonal corners into the middle), then fold the top of the triangle down so it makes a kite with a flat top, and then fold the tail of the kite up to the length I need. It's a little bulky (the pants she wears need to be at least 1 size bigger than the size top she is in!) but I find its very absorbent, even for overnight when she happens to sleep through.

I wash nappies every second day (just throw them in a bucket until I do a load) with Napisan and they come out really well, even the pooey ones (which I rinse after I take them off). I have quite a few white ones, and even though I dont soak the dirty ones none of them have stains.