Is there a particular type of wood that's better/preferred for making toothpicks than any other type of wood? If so, why is it better? ~

Birch are made then bleached to lighten then and kill the germs that might still be on them...
Plastic wood be easier to make them from though :)

Oddly, NJ is right. Birch. 

I've actually been writing for a furniture company that has had me creating pages about the various wood types lately and I actually talked about toothpicks in the birch one. 

It's a really strong wood that has a good grain, so it's not likely to splinter, split, or blunt. There are many native birch trees and they grow in abundance throughout the US and Canada. However, birch doesn't get the same kind of polished sheen as other woods like maple, so if it's used in furniture nowadays, it's on the parts you can't see. It was popular in the 60s and 70s and can be pretty yellow as well, so when it is used for decorative things, they tend to look dated or vintage. Ergo, there's plenty of birch around and it's a good utilitarian wood, so it's the top pick for toothpicks.