Why towels as gifts?
You need lots because most people use them once and wash, and it’s something where expensive ones are a nice bit of luxury that you probably wouldn’t treat yourself with without being showy (although expensive brand ones are also available)
Why sugar, green tea, seaweed, handkerchiefs, furikake rice seasoning for reihin funeral return gifts (礼品 れいひん) ?
My latest theory is that by giving someone something ordinary they need all the time you are saying that because successful people like them have all have everything they need already that is the only thing you could buy. They are also all things that you can get in any price range
Why do people send return presents after you attend a wedding or funeral?
Attending is considered an obligation rather than a personal choice, so you must be thanked/repaid