Why is moisture a chatzizah for netilas yadayim? I guess you can say that the hands must be completely clean, but then why don't you have to wipe your hands in middle? For example, one who washes his hands twice right and twice left, he should wipe his hands in between the first right and the second right.
It's not a matter of a chatzitzah - anything liquid wouldn't be a chatzitzah, because the water will wash it away (Shulchan Aruch, Orach Chaim 161:2).
It's rather that the water from the first washing becomes tamei by touching your hands (which themselves are tamei - that's why you have to wash them), and the second washing then renders the hands, and the remaining water from the first washing, tahor (ibid. 160:2,4). So there's no reason to dry your hands between washings.
(If your hands weren't clean before you started washing, then you need three washings: one to remove the dirt or whatever, and then a second and a third following the same principle as above. There are halachic opinions that three washings are always needed; this is the Chabad custom.)