Stick to the foil. I don't know why there seems to be a rash of people spreading the damp towel thing around, but who wants to continuously have a wet towel hanging around on their stuff? It's a breeding ground for bacteria and germs, not to mention the inconvenience of having to re-dampen it continuously. It also helps to place your water so it's under the foil and a bit on the warm side.
A good guide to follow if you're using a glass tank is http://ball-pythons.net/forums/showt...With-Pictures!
And a decent thermostat to start off with under 40$ is available through Amazon http://www.amazon.com/MTPRTC-ETL-Cer.../dp/B000NZZG3S