Yep, definitely can't cut it straight out of the freezer. Bread thaws really quickly, though, so just give it like 15 min. Any other storage way will make it rock hard. The paper towel idea might work a little, but it'll make the crust just as soft as the inside part. That's why I just A) make my own, and B) give away the extras! Everyone loves fresh bread, right? This recipe is super easy:
http://www.becomeabetterbaker.com/Recipes.aspx?RecipeId=6fc9c719-0aa3-42ba-a9c3-e6f60bf2fe49