oh yeah and in photoshop, when you're doing the file - make sure you begin with a _transparent_ file. the physical size of the file doesn't really matter, as long as the circle shape of the label fits in. now when you have the circle marquee floating, feather the edge black or whatever color you want. then expand the marquee (don't unselect the marquee!) by a couple of pixels and press CTRL-C (or edit->copy) to copy and then hit the DELETE key.

now press CTRL-V or edit->paste and your image will be in the DEAD CENTER of the canvas. now you need to crop the canvas to be the size of the self image, so be careful not to leave anything out.
when you have the image centered, make a new circle the size of the inner label circle (you know where the platter's center "needle" sticks out from) and paint it white or something. again, expand the marquee by a couple of pixels again and repeat the previous process.

this way you have everything in the dead center. now all you need to do is make the artwork.

cheers.