A/C doesn't work very efficiently for dehumidification purposes with OAT below ~50F, and not at all below 35F. To defog/demist the windshield with OAT in this range turn the heat up at the time you activate the defog/demist function.
Heating the windshield in this manner makes it much less likely its surface temperature will be below the dewpoint of the cabin atmosphere. Lowering a rear window slightly during the time the system is in defog/demist will also help immensely.
Also read:
"03 Camry - Air smells bad"
at:
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