On Shabbos, is one permitted to wipe his hands on paper towels still attached to the roll, without tearing them off, or are they muktza?
They may be used to wipe hands. Even if they have muktzeh status it would be that of “kli shemelachto leissur” a utensil whose usage generally involves Shabbos prohibition. This form of muktzeh item may be used for a permissible use on Shabbos – “ltzorech gufo”.
Shulchan Aruch O:C 308:3. Some hold that toilet paper and paper towel are also set aside for use in a permissible way and are hence not muktzeh at all, See Chut Shani Shabbos Vol. 3 pg.158.