HI fabricluvr,
I just did one and did a little research online first...hope you find this helpful.
I used a product from Lowe's that was inexpensive, used for insulation (?) normally and a great find. The person I spoke to suggested "blue board" which I found, but used a different type in the same isle.
I used whatever material I had here and had a few choices. I placed a light colored finished block on each to see if it was a problem. I found that the darker material distorted the color of the block and I thought I might have an issue always seeing a dark space between each block when figuring a layout. I also noticed the light threads on the dark background right away and knew it would annoy me. If it's not distracting to you, it would be nice. I ended up picking a light pink tiny floral...from far away, it falls away and the blocks really stand out so I can get the images right in my head. It's a 70s poly flannel and EVERYTHING sticks to it.