Cut the paper towels in half. You can use a large sharp knife or an electric knife if you have one. I was given a used one several years ago and it does make it a bit easier. You'll use half of the roll now and the other half will be ready for your next round of wipes.
Next you mix two cups of water with about 2 or 3 tablespoons of baby wash. I just give a couple good squirts and stir it in with a spoon. You can either put this in the rubbermaid container and drop the paper towels in after (which will take a while to soak in) or pour it over the tops of the paper towels. If you pour it over the top, the cardboard tube will get soaked quicker and you can pull it out sooner (if you're in a rush to use your wipes).
Once you've pulled the cardboard tube out, start pulling the wipes from the center. Notice my lid. You don't have to do this at all, but my lid started out with a LITTLE x in the top for pulling the wipes out (exacto knife). As it's been used for years and years, constantly, with usually 2 babies in diapers the whole time, it's gotten a LOT of use and the original little X split all the way to the edges. Which is not a big deal...the wipes still stay wet. You don't, of course, have to cut your top at all. You can just leave the top whole and take it off when you use it. The choice is, of course, yours.
And, ta-da! Here are home made wipes! For me, with 2 in diapers and using wipes only for diaper changes, we usually go through half a roll a week, more or less, so a 12 pack of bounty paper towels which were a bit under $7 last time I bought them, will last about half a year. In the course of a week, they don't get the mildew smell. If you use yours more slowly, you might want to use a few drops of tea tree oil to keep them fresh (I never have). I don't know how long it actually takes for them to start smelling a bit stale.
Last note. I've looked for the round rubbermaid containers like the one I use and I haven't been able to find any for the past few years. Some of my friends who have started making wipes more recently use a square rubbermaid container that's just a bit taller than the half roll of wipes. It'll have a #6 on the bottom. Here's the size (this is my flour container).