On a side note, if you want text to follow a shape that's available in Custom Shape Tools, you just have to put the shape in your LO, it already has a path to follow - just click and type!
For this example I'll just be using a heart shape. Ensure the shape/photo you want to follow is on a single layer. Hold Ctrl & click on the thumbnail of this layer - this will create a selection around the shape. Now create a new layer.
As you'll want the text to be slightly away from the edge, you need to expand your selection - Select>Modify>Expand - for this example I've used 5 pixels.
Next, select the Paths tab on your Layers palette and click on "Make Work Path From Selection"
Now select your text tool and select the font/style you want to use. Move your cursor over the path, a small curved line should appear across your cursor (this indicates your text will follow the path). Now just click and start typing! (the text can be edited later the same as normal text)
For anyone having trouble getting their text on the path, this is what your cursors should look like.
ON the path:
NOT ON the path
