I'd never touch a car with one if I were concerned about instilling new/more marring. If that's not a concern, then I too would think along the lines of aggressive paintcleaning/oxidation removal, or maybe using it as one would use a twisted wool pad.
But a whole lot depends on the chenille in question, all cotton is not created equal. Many of us have used cotton for aggressive (first step) correction by hand, but many of us have also marred paint by drying it with a "nice soft fluffy 100% cotton" towel too.