They aren’t sterile, and I’ve never actually run into anyone that seemed to think they are.

What they are is clean enough
The paper is rolled up, relatively dry, usually wrapped in a barrier, and isn’t a food product that will draw unusual amounts of pathogen carrying critters. So you end up with something that is cleaner than the things you use it on, akin to rag you pull out of a drawer that you washed weeks ago. Or a dish that’s been sitting in your cabinet for similar periods.

When it comes down to what they’re used for commonly, that’s clean enough. It won’t be bringing pathogens into contact with anything you’ll take inside your body. That’s all that matters.

Mind you, it assumes you’re storing them in a way that keeps junk off of them. But as long as that assumption holds, you can use them as napkins (which are no more sterile), use them to mop up spills (likely cleaner than av actual mop), as a crumb barrier and wrapper for a sandwich, whatever.

There’s really nothing you would be likely to use them for that would be problematic, particularly in an emergency. Better than toilet paper in that regard, as tp is treated to break down easily in water (and the chemicals used to do that stink btw). If you need a wad of something to cram down on a wound to control bleeding, as an example, paper towels would be better than a random shirt you pulled off your body, as it’s going to have lower concentrations of things like staph, yeast, and strep, as well as the numerous other critters that populate our hides even fresh out of a shower.