I think your first idea might work....

Check this guy out.

CNC Software
(Vid at bottom of page)

He does pretty much the same thing, he applies self adheasive vinyl to the work piece, does the cutting, sprays the piece and then removes the vinyl. Results look really good.

He is however cutting mdf. Like you said, it may melt at slower feed speeds?

Another option that might be worth looking at are water slide decals...
Make your own water-slide decals using your inkjet printer

I have just bought some for a project but I haven't used it yet so I can't fully say if its a winner yet...

Jim