Scot and I have always been avid collectors of stickers and what nots from our travels. Our cooler (which we have had since we were in college... I think I was actually in HIGH SCHOOL when we bought it) has sported over the years a number of stickers. Now with dive travels, it's patches.
I was a bit worried about defacing a $250 bag, but I wanted to make the spider bag of the Dive Caddy into our new billboard for Cool Places We've Been(TM). Chad at Dive Caddy assured he they'd done the same thing; a light iron on a fusible web to hold it in place before stitching would do the trick.
The iron on synthetic wasn't enough heat; moved it up to "silk" and it worked well. Always beware ironing on unknown fibers. A quick stitch around the edge and... voila.