1. Cut some squares, making length and width 1/2 inch bigger to accommodate folding over & finishing the edges.
2. Fold & press 1/4 inch on each side with an iron.
3. Repeat -- so that the raw edge of the fabric is no longer showing. (You've just folded it over twice - no biggie.)
4. Zip around the perimeter of the napkin with your sewing machine to sew in place the finishing job you just did with the iron. Use a reverse stitch at the beginning and the end, so that it will hold up to lots of washing.