A couple of things:
1) I've heard that covering the screen lid with tinfoil instead of cardboard/towels will help. Just check out the "How to Set Up a Glass Tank" thread. (In theory cardboard is somewhat absorbent to moisture, while tinfoil is not)
2) Instead of a moist towel, try wetting some sphagnum moss and spreading it around the tank. Keep the sphagnum moss moist with spraying or occasional washing.
3) Are you opposed to changing the substrate to something like Eco-earth or Cypress? I know paper towels are convenient, but changing to something else might be worth considering.
4) Does the night-light contribute much heat? I can see how humidity would still escape through that hole in the middle of the cardboard.
5) It's normally recommended to have two hides in the enclosure, one on the hot side and one on the cool.
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