printing your own labels for your domestic packages is DEFINITELY worth the effort....all you need is either a pay pal account or credit/debit card (to use if you buy your postage directly from the usps website instead of via ebay/paypal) and a printer....no special paper , no special forms...and best of all 9well , next to the price discounts) no driving to the PO or waiting in line - you can either request a carrier pick-up or even easier , just drop them in your own mailbox and your carrier picks them up when he drops off your mail....
only packages i dont ship this way are the international parcels ....
as for the size of the labels , you can manually adjust that using the settings on your printer....i've actually received a few from people who shrunk them down so much they were little more than the size of a business card....personally i use the default size which fits perfectly on a 4x8 mailer....