From a consumer's standpoint, I like the shrink wrap because I can actually see the soap. The deli paper wrap is translucent so you get a hint of the soap's appearance, but I still prefer at least a bit of the soap to be fully visible -- I want to appreciate the color, texture and overall look of the soap before I buy.
From a seller's standpoint, I also prefer the shrink wrap, because the label is protected underneath the plastic. Shrink wrapping is also faster than wrapping in deli paper, especially with soaps that have rough tops. I'd tweak the method of applying the shrink wrap, so the corners are flat and tidy -- that detracts from the appearance of the shrink wrap. You could use the ribbon/tape idea with the shrink wrap -- I really do like the color accent.
Regardless of the packaging you use, I'd trim off some of the blank card at the bottom of the label to make it a bit smaller. The smaller size will let you position the label so it is centered on the face of the soap and none of it folds over the top. That will also add to the crisp, professional look.