Can anyone tell me what particular type of paper used on custom/homemade t-shirt designs?
You can buy them at almost any store that sells printer paper. It’s called T-Shirt transfer paper. EDIT: Scratch that. Come to think of it, they probably used screen printing. Screen printing can be done at home for fairly cheap, but not nearly as cheap as transfer paper. You would need about $100 to $200 for a basic setup, but a good screen printing setup could cost thousands of dollars (including a screen printing basin, etc.) Andy Warhol used screen printing a lot. Here is a basic diagram of how it’s done: http://photoshop911.