Label text that's too big for the field is currently wrapped by character. It'd be more useful to either change to wrap-by-word (only 2 lines changed in label-text.c) or add a user option to do so (er... a few more lines changed somewhere :-).
This is actually already addressed in the development branch: text objects are now wrap-by-word.
This is actually already addressed in the development branch: text objects are now wrap-by-word.