I just recently came across this fantastic 1985 recording of Townes Van Zandt on a Tennessee NPR station and I nearly flipped when I heard him start playing Dylan's "Just Like Tom Thumb's Blues" right in the middle of his "Colorado Girl."
It's stunning - a perfect recording and just an absolutely flawless performance. And it's extra huge to my ears, because this is the first prime Dylan song I've ever heard Townes sing.
Before this, I've only known two Dylan songs that Townes has covered, both obscure tunes to even the biggest Dylan fans: "Man Gave Names To All The Animals" (from Slow Train) and "Rambling, Gambling Willie" (unreleased before the 1991 Bootleg Series, which Townes played as "Little Willie The Gambler"). Both covers are on Townes' Roadsongs disc.
Dylan, of course, is a fan of Townes' classic "Pancho & Lefty."
Townes Van Zandt - Colorado Girl -> Just Like Tom Thumb's Blues
Bob Dylan - Pancho & Lefty (live 2004 Bonnaroo)