Izzat so:-? Maybe it is up there, but down here (south of Watford) I don't think I've ever heard it. ;-)In BrE, the expression "wipe yourself dry" is commonly used.
In AmE, "wipe yourself" usually refers to one's rear end after defecation. Sorry to be crude.
In AmE, we usually only use "dry yourself" if that person is wet from water. If that person has spaghetti sauce on their face, or has fallen into a big mud puddle, then we'd hand them the towel and advise them to "wipe" themselves.
I'm with BobK. Down here in the sunny South of England, I've never heard "wipe yourself dry" when talking about using a towel. I've used "towel yourself off" and "towel-dry your hair".
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