Mild soap and water = Woolite cut 10:1 with water.
Terry cloth = Microfiber.
Conditioning the leather can certainly be done. There are lots of good ones out there. You can get stuff like Lexol over the counter. Companies like Poorboy's World make some nice leather conditioner too.
Keeping the leather clean is 90% of the battle. Once those salts and oils work their way into the leather, it breaks it down. Honestly, my next car with leather is getting a nice sheepskin cover from day 1. At least on the driver's side. And a nice rubber mat!
