How do I best go about setting a cut path in Illustrator? I want to cut letters and images to be used for shirt printing.
You have to contact the printing service. They have to tell you.
Like what Monika said, you have to know the specific cutting device being used and software to control it to create cut paths that will work. For instance, here at the sign company where I work, we create cut paths for print and cut operations in large format printing.
We used to have a Roland VersaCamm that would print and cut in the same machine. We would run out a print job, let it out-gas for at least a couple or so hours, run the print through a laminator and then feed it back into the printer and let the printer read the registration marks generated on the print. Roland VersaWorks (the RIP software) would cue up the cut paths for cut-only operation. Now we use a pair of HP Latex printers in conjunction with Graphtec plotter/cutter devices to do the same thing, only much faster. Both Roland VersaWorks and Onyx Thrive pretty much do the same thing reading cut paths. You create a spot color named "CutContour" and apply that to the outline of the desired cut path.
Cut path methods for t-shirt production could be different.
I'm using VersaWorks for my printing and cutting on a Roland VG2-540. I'm familiar with laminating and then sending back through with registration marks to cut a file that someone else had created. Just need to figure out how to do it on my own. Thank you for the feedback. I'll look into creating the CutConture.
If you are cutting it on your own device, I would advise you to read the documentation of that device.