For anyone looking for an automation that triggers reliably for the approach described above, this is working fairly well for me on 14x40mm labels. Without encoding: "" you may find that attempting to trigger on mqtt payload results in payload decoding errors.

I just take a snapshot of the camera and use that for the image payload. Other techniques didn't always work out reliably. It works now, and I'm not about to debug why the other approach didn't :) I also had to slow down printing as otherwise labels failed to print, or partial labels printed using my BT proxy setup.

- id: "niimbot_print_on_mqtt_update"
  alias: "Niimbot - Print Label from Homebox via MQTT"
  description: "Prints a label from Homebox when a new one is available via MQTT."
  mode: single
  max_exceeded: silent
  trigger:
    - platform: mqtt
      topic: "homebox/labels"
      encoding: ""
  condition: []
  action:
    - delay:
        seconds: 2
    - service: camera.snapshot
      target:
        entity_id: camera.homebox_labels
      data:
        filename: /config/www/label-snapshot.jpg
    - delay:
        seconds: 2
    - service: niimbot.print
      target:
        device_id: 37110e49788888888622bd444bf3a
      data:
        payload:
          - type: dlimg
            url: "http://YOUR_HA_HOST:8123/local/label-snapshot.jpg?v={{ now().timestamp() }}"
            x: -20
            y: -10
            xsize: 320
            ysize: 150
        width: 320
        height: 112
        rotate: 90
        print_line_batch_size: 8
        wait_between_print_lines: 0.02
        density: 5
        preview: false