I took an example of printing serialized business cards 500 quantity on 10 up card stock which means I will print on 50 sheets
I added 4 columns on the spread sheet
A - Sequence number 1 - 500
B - Sheet -- a repeating sequence 1 - 50 for which sheet the record will be on (I used copy paste to fill the column)
C - Position -- on sheet where the record will be 1 repeated 50 times 2 repeated 50 times and so forth (I used copy paste to fill the column)
D - Order -- The formula which gives the magic order number for the merge = ( ( Sheet - 1 ) * 'number of labels per sheet' ) + Position
=((B2-1)*10)+C2
Sort on the Order column and run your merge
Hope this helps I'm sure this could be made more automatic with a Macro
Dave