There is a great write-up on CC explaining most everything you want to know about the printers, paper, etc... at the following link.
http://www.cakecentral.com/cake-decorating-guides.html
I use the canon printer also. The ink is what is special about printing on edible paper.
You can also use food writer pens with rice/wafer paper (americolor is the best imho). It's nice because you can do 3d stuff like butterflies and flowers.
But if you have the edible image printer you'll get crisper images and with frosting sheets. (you can use wafer paper in the printer also though).
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-Rezzy
I don't use a printer. I use crayons (non-toxic) to trace the image (from a coloring book, etc.) directly on the rice paper. Then I cut the image out and brush some corn syrup on the back so it will adhere to my buttercream iced cake. Then using buttercream icing and tips I outline the image and fill it in. I have posted a few pictures on this site if you'd like to see my results. It's relatively quick and easy...of course I only bake/decorate cakes as a hobby/sideline.
I have a projector from Kopy Kake and have used it to outline onto rice paper and then fill in the color. I hope to get a printer for icing sheets soon though. 
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