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However, if I search for (bath AND towel) on AOL, I get a bunch of listings. These listings are on DMOZ but not necessarily under the search for bath towels (AND is the default). To me, it looks like AOL just takes all sites from DMOZ and lists them in an order that is determined by their own algorithm. Then, after all sites on DMOZ that contain bath OR towels are exhausted, the inktomi results are listed (by the way, I am looking at Canada.com to see what results should be considered Inktomi results since they supposedly get their main listings from here).
There have been several discussions about this, and yes, the agreement seems to be that AOL is using something proprietary. When you search over a variety of keywords, no simple combination of ODP + Inktomi can account for everything you observe.
However, no one has yet come up with the exact nature of AOL's proprietary algo. Lot's of guesses (their own click data?) but nothing nailed down exactly.