A little update about the situation;
Since I have last posted, the remaining chick has thrived just fine, and doesn’t seem stressed about being by herself. I also got four more chicks from a local feed store a week ago, and they seem more robust than the ones I got from Cackle. They are in a different brooder for now due to size difference. I also acquired another chicken from a neighbor, so the original chick won’t be alone forever by any means.
I have concluded that the two that passed died from sudden death syndrome, since they were flipped over on their backs when I found them and that seems to be a common trait. I don’t think the cloth was a problem, since not all of them had issues and it seemed to be more than a respiratory problem (loss of balance, listlessness). I didn’t contact the hatchery, since I don’t care much about getting a refund and didn’t want replacements from them.
Thanks everyone of your suggestions and concern!