I don't feel comfortable speaking to the technical health advantages of cloth over disposables, but I'll tell you my experience. With G, who was diapered exclusively with disposables, I didn't feel like there was a problem with the diapers. We generously slathered on diaper ointment at every diaper change, assuming that was par for the course. When he got diaper rashes that the ointment (which failed in prevention) failed to heal, we resorted to naked time and/or chamomile tea baths (which, incidentally, also did wonders for his eczema). It's not that he had a constant diaper rash - it just wasn't so much a surprise when he did.
When N was born, I was already stocked up on (cloth diaper safe) diaper ointments. For the first three weeks of her life, we used only disposables and applied the ointment at every diaper change. Her diaper area was pretty red most of the time. Once we started throwing cloth into the mix, I continued on with the ointment the same as always. A funny thing happened, she wasn't red or irritated when she'd been wearing cloth. As my cloth diaper stash grew, my ointment vigilance lessened. Now that we use cloth full time, she never has a rash unless she's been left in a dirty diaper too long (like if she manages a BM in her sleep), and those are pretty much the only times we bother using the ointment anymore.