Okay, so this label actually belongs to a wall quilt that I just finished ~ but the idea works just as well for Priority Quilts...
I start by using Microsoft Word to create the text and graphic layout. Once I'm done fiddling and tweaking, I print the label onto a sheet of Printed Treasures inkjet printable fabric.
I leave 1/2" of label beyond the text/graphic when trimming.
The edges are finished with 1" strips of fabric (contrast, coordinating, leftover ~ your choice) which are stitched to the label using 1/4" seams.
The edging fabrics are folded to the back and pressed before the finished label is hand stitched to the quilt.
In the case of PQs, I typically print the label as above, but then apply a fusible like Steam a Seam to attach the label to the PQ.