As soon as protruding labia minora (majora?) comes in contact with cotton underwear i have discomfort & itching. no thrush. no shaving cream used here

Mechanical issue: The minora varies in its size and shape, usually developing most during puberty. For some it is tucked in and minimal & others it is quite large and appears like elephant ears. When/if it become uncomfortable wearing common clothing it may be reasonable to consult a gynecologist or plastic surgeon. An easy procedure can re-shape this to a less bothersome size. Cotton is about as good as it gets.