Well, I'll add a +1 vote to ALWAYS swab it out and ALWAYS keep it in the case when not in use. I only use a stand when I'm playing and need to switch to another instrument (piccolo, alto, bass, sax, etc). My reasons are similar to FG18.
As far as swabbing with a pull thru cloth to clean it, if you hold the flute vertically for a moment or two, most of the condensation will run out of the body. When I do that, I get a little moisture on the cloth which shows that it is absorbing most of the condensation rather than pushing it into the tone holes. BTW - There should only be condensation in your flute - not saliva. If you have saliva in your flute, YOU'RE DOING IT WRONG!!!
(Steve - I'm just yanking your chain a little on that last comment...)