I had the same question about screenprinting on Baby apparel, especially the on the front...I guess the same concerns would apply to plastisol heat transfers (I've been reading the forums about this option lately)?
Teddy, I also had the thought about printing on the back of the apparel. Not a bad approach for chewing babies.
Thanks for mentioning Walmart's use Neato, I will peek in there today to take a look of some of this. They have quite a few baby bibs with graphics all over the front but can't tell from the online pics if it's embroidery, plastisol or water-based inks.