Actually, the only real justification for putting the merge fields on the master are if you have other master elements you don't want duplicated for each record in a mult-record merge, and more importantly the bilityt to update an already merged file when the data set changes.
I generally do my merges with a blank master, then apply the correct master after the merge to avoid any issues with master objects, and from reports here updating an existing file that has merged images is a lot less than reliable -- the images reportedly disappear. Given the ease of saving the merge temaplte and just rerunning the merge if the data changes, I don't see any compelling reason to use merge fields on the master page in most cases.
