Greg . . . towards the end of 2007 we went to market with our line of soaps, lip balms, bath salts and such and I could not afford custom labels for each product, fragrance etc. I tried templates in Word and Word Perfect with marginal results. Finally I tried the free Avery program that came with some filing labels we needed and with a little tweaking of the margins we are getting perfect labels now. The Avery program allows you to import a complete label designed in Photoshop, then adjust the size to get it placed within the specific label stock. To "proof" the set up, I print a full sheet of labels in draft on a plain sheet of paper, then hold it up to the light on top of a sheet of labels to check placement top to bottom. Also, I have found that with some sheets of ovals and circles from Labels Online ( a HUGE selection of sizes and colors) that it matters which end is started through the printer. This was very frustrating for a while. Seems the outside top and bottom waste area was slightly different. Now I take a sharpie and mark up one end of a 100 sheet stack when I receive them, and that colored end is always oriented OUT of the printer.
Their moisture resistant stock really is . . . no smudges but it is only in white. When I want a kraft or other color, I take the minute or two to spray coat the printed sheet. You can wipe honey off of it with a moist towel and it will not smear. It has taken some time, but the whole design and printing process is easy now . . . save bee for a spelling correction from time to tyme. I have saved hundreds of dollars, and can change fonts, colors etc as my wife wishes. Until we have need for hundreds of a particular label, this method is working very well.
Don't give up, and may the force bee with you!