I made fabric labels to sew onto my luggage tags using an amazing tutorial from Dolls and Daydreams.
Here's how the labels turned out:
(this was after I used some of the labels)
I had a little trouble feeding the fabric/freezer paper through my printer. It took a few printer jams and lots of grinding noises before I got it to work... I may not have cut the paper just right. Eventually it worked though, and I'm happy with the outcome. (and my printer survived... this round at least!)