I should warn you. This mama isn't tolerant of towels left to funk up a bathroom. So, my response may be strong in spots. ;)
Even if you live in a hot, humid climate, towels should not be molding or getting musty, unless maybe you don't have air conditioning. Air conditioning removes enough moisture from the air that towels should EASILY dry in the house.
I do suggest, though, that you avoid giant towels. The human body can easily be dried with the old standard sized bath towel. In fact, I've dried off after many a bath with a hand towel, even when I had much longer hair.
Children definitely don't need big towels.
Washing and drying large towels that are unnecessarily used creates additional stress on our fragile ecosystem. That, however, is probably best left for another thread.
Someone raised the issue of microfiber towels. I have used a larger microfiber towel from the auto section at the store for an extended period of time. However, these do develop an "odor" more easily than regular bath towels. They dry fast, but sometimes smell awful.
So, what to do with the towels? Simple. Hang them up. Use hooks, towel rods, or even an over the door hanger of some sort. Inform everyone that they must hang up their towels, and set consequences for those that do not.
If the bathroom is too small, then get creative. Put hooks in bedrooms. The garage works. Hooks under a patio works. A drying rack can be placed in a bathroom, patio, balcony, etc. Each person can be responsible for taking their own towel to the designated location and retrieving it before the next shower/bath.