If you are using novelty fabrics for an I Spy quilt - you might consider "fussy cutting" your fabric for this application.
Fussy cutting is selecting a certain area of the print and cutting each square individually so that if, for example, your print is of cows - you have a whole cow in each square - instead of the back end in one square and the front end in another.
If you choose to consider this way of cutting pieces for an I Spy quilt - I have found that cutting a square of template plastic the "unfinished" size - in your case 5 inches - and then putting 1/4 inch tape on the edges to "frame" what will be showing - has worked out fairly well. Or you could just draw the stitching lines on the template to "frame" what will show.
But back to your original question - the folded piece has to be "even" - and the cuts exactly perpendicular to the edge. I have found that no matter how careful I am, I have to "adjust" every so often to get my perpendicular "On" again. I also check every two or three cuts to make sure that the pieces are staying straight.
I also would have washed my fabrics before cutting them. But that's my choice.