I had this issue as well. Here's How I fixed it. Note that this is specific for label printers, so it may not work for people who wish to achieve this with a regular printer.
Firstly, I wouldn't recommend printing out your shipping labels directly from your web browser since paypal assumes that you will be using a regular sheet of paper.
To fix your issue by not including the instructions AND to print out the perfect sized shipping label using your label printer, I recommend first saving the shipping label as PDF (change the destination to PDF in the printing dialog to download as PDF), and then once you've done that, you can follow the short video below and it demonstrates how to print out shipping labels free of sizing issues from PDF format.
https://www.youtube.com/watch?v=GSelWKJKFFU
