What page size did you specify when printing?
How is the layout from which you printed designed? If the layout is larger than the maximum label size by even 1 pixel, you'll get that extra "page" so you may need to shrink the total size of your layout by a small portion unless you have the wrong page size specified for your label printer.
The size of the label is 3.5 by 1.12. I have checked and the preset size for the label is the same. Here are some screen shots. This is the size settings I have for the body of the layout.
Here is a screen shot of the size settings I have for the tex box in layout.
Here is a screen shot of the print dialogue.
Since your label prints correctly it is probably a problem with the paper or margin size being a little too large.
But just in case try reducing the size of the text box until the handles are off the edges.
Have you created a Dymo paper size in Page Setup?
In the Layout Setup > Printing are you using fixed paper margins?
Try reducing the label (paper) size or margin size until you find the sweet spot.
I see a layout size of 1.125 inches and you indicate that the paper size should be 1.12. That small discrepancy may be enough to trigger the extra page when you print.
I'd change the units from inches to pixels by clicking the units until they cycle to the pixels setting. Then I'd click the body label and reduce the height of the label by a few pixels by editing the number in the Inspector. Then I'd change back to inches to see if I can get a value of 1.12 or a bit smaller.
Then I'd preview my layout with the dymo printer and custom page size selected to see if I get one or two pages when I preview it. (Click the book icon to see additional pages when you are in preview mode.)