I just use my shirt.. is that bad?

It doesn't scratch it or anything, I just checked.
The only reason I don't recommend a shirt is because that just because you can't see a scratch doesn't mean it isn't there. After repeated use they build up. Now for guys it isn't that bad, they are hardly noticable, but being a girl I wear makeup and it will fill those little scratches. So, for that reason I say use a cloth meant for glass and if you can use a bit of moisture.
I wear makeup, too!

j/k Yeah, I wouldn't use a shirt either. Also, shirts can have dust and dirt on them that will get in the fragile areas like the camera lens cover.
Speaking of cleaning the phone, how do you clean the QWERTY keyboard? I've been using a monitor wipe, which does a decent job.