How to Import custom label sheet for merge setup?

I guess that almost says it all, except when I attempted to clarify this in an edit, I suspect what I am trying to do is a document merge with fields I would need to create on the document that has the labels, one file has all the data and the other has a layout of six labels.

I have a custom label sheet (8.5" x 11" paper, 2 rows, 3 columns with margins) that I wish to use in a merge for name tags. The sheet is NOT printed, so I am not feeding it through a printer for the merge, I wish to do the merge on the computer and send the completed label merge file to a printer at a later date. Part of the reason for this is that I do not have a color printer here and the label picture itself uses color.

Where it gets a little more complicated is that though each of the six labels per page is the same, it is a picture (when I double click any one of them the "Picture" ribbon comes up).

Is this a doable endeavor, or is it something that needs to be handed off to a professional print shop?

1oo% doable.

You can try to arrange that in two steps:
1. Prepare them for printing and create a PDF file with virtual printer like CutePDF.
2. Keep PDF file to print it later.