What I do is pretty similar to what you're doing, at least for big letters (say over 2"). I just do the cutting from the front, although I think I could get my computer to reverse the letters. I just use tiny little bits of masking tape to hold the computer print out on the trim sheet (or on Monokote). It doesn't actually take that long to cut out the letters, which is why I've never used a vinyl cutting service.

For smaller print, I print on Avery clear full sheet label stock with a laser printer.