This is the method I use for my labels also. In working with a friend we now have 7 labels on 7 quilts. They have been attached and then quilted over.
Now, I discover a misspelling. The small "h" should have been a "n". Do you know any method to remove a part of a letter? I tried a toothpick with bleach then ammonia. My letters were heat set. Now, what?
HP ink does not seem to wash out. I printed on scraps and ran through washer before I began to use this process routinely. My stays very well without bubble jet and just using any cotton fabric I have.