Now, all you have to keep in mind is that the dimensions of a CD booklet are:
Width: 120mm or 1.2cm
Height: 120mm or 1.2cm
Maybe if you were designing a cover for a minidisc
I use Nero Cover Designer, it's a very good program on it's own but its image manipulation is pretty limited. If you coupled it with an image editing program it would do everything you want. The only other downside is it uses the windows fonts, which are a bit limited, but if you got a font pack like James suggested then it would be the perfect program for cd covers.
It has templates for DVD's as well, and there are a heap of CD label brands in the print options - so you never have to calibrate the printer. I dunno if you're doing the labels or just the cover/booklet but it's good for covers and inlays too. Basically it gives you the full size blank cover on screen and you paste what you want into it.