Outside for sheets, Doona covers, Teatowels, pillow slips.
Dryer for all else. Don't like towels outside, too stiff & scratchy!
When first married, then had kids', EVERYTHING went on line outside. It was a 5-line Hills Extenda-line, & soon got filled up!
If it was raining, had a large area underneath a patio, with multiple lines strung. The breezes would eventually dry all.