Dying requires you to put the towels in boiling water, and from what I understand damages the thin parts of the microfibers. Once they are damaged, they can no longer grab. So in essence they become regular towels, loosing their microfiber aspect.
I like the simple system for having 3 grades of microfibers:
New, used but in good condition, used and in bad shape.
I used the new and like new towels for paint and glass and the bad shape one for wheels, jambs, and other dirty work.
I know people like color coding towels but I never felt a need to do that.