There's a very small, subtle difference between the two constructions here, though both are valid and acceptable.
Is the word cloths still being used?
This might be construed as asking if cloths is, right at this exact moment, undergoing linguistic utilization.
Is the word cloths still used?
This asks if people still currently make use of the word cloths, but does not inquire about whether it's being used just this second.
Really, the grammatical difference is negligible here. The present progressive does not necessarily mean the action is happening exactly at the time of speaking, and the majority of listeners will not make any semantic distinction between the two phrasings in this case. Consider this potential answer:
Yes, I heard it on the radio yesterday.
This response is perfectly valid to either version of the question. It conveys that cloths is still part of current English lexicon even though the actual usage of the word occurred in the past.
When we ask whether a word is used, it's understood that the state of being in use need not be literally continuous. Lexicon is currently a word that's used, because it's part of modern English vocabulary, and people say and understand it. It's not very likely that every moment someone is saying, writing or reading lexicon; it's probable that lexicon isn't literally being used at any given time. Despite this, we still consider it to be used because it shows up frequently enough in English.
The other differences between the two sentences are stylistic choice and frequency of use. Asking whether a word is still used is much more common than asking whether a word is still being used.
Best Answer
Yes, we still use it, and yes, it is usually a piece of cloth or fabric, typically with a specific use. As you see from your own examples, we use it more often as the plural of a compound word such as washcloth, dishcloth, or tablecloth.
For an example of the use of the word on its own, google "burp cloths". You will find all sorts of them for sale; burp cloths are cloths (pieces of cloth) that you can put on your shoulder while you're burping your baby, so he won't spit up on your clothes.
You can also use "cloths" to mean different kinds of cloth, as in "We have several cloths that will fit your needs" or "our hand-tailored shirts use only the finest cotton cloths from Egypt". Saying "cloths" instead of "cloth" here implies that there is more than one type of finest cotton cloth coming from Egypt. However, in this situation, "fabrics" is probably a bit more often used nowadays.
p.s. "EN-gram" is how I pronounce Ngram.