How to set the minimum margin in CUPS / foomatic driver?

It turns out that the problem is not with the hardware margins in the printer; the page definitions in the ppd file had set a printable area with 0.5" and 0.25" margins for a letter page.

To fix this, edit the ppd for the printer (/etc/cups/ppd/yourprintername.ppd):
Find the list of *ImageableArea definitions of page sizes:

*DefaultImageableArea: Letter
*ImageableArea Letter/US Letter: "18 36 594 756"
*ImageableArea A4/A4: "18 36 577 806"
*ImageableArea 11x17/11x17: "18 36 774 1188"
*ImageableArea A3/A3: "18 36 824 1155"
*ImageableArea A5/A5: "18 36 403 559"
*ImageableArea B5/B5 (JIS): "18 36 498 693"
*ImageableArea Env10/Envelope #10: "18 36 279 648"
*ImageableArea EnvC5/Envelope C5: "18 36 441 613"
*ImageableArea EnvDL/Envelope DL: "18 36 294 588"
*ImageableArea EnvISOB5/Envelope B5: "18 36 481 673"
*ImageableArea EnvMonarch/Envelope Monarch: "18 36 261 504"
*ImageableArea Executive/Executive: "18 36 504 720"
*ImageableArea Legal/US Legal: "18 36 594 972"

Find the paper size you want to modify the margins for and change the definition (the part in quotes) to match your printer's actual print margins:

Format: "<bottom-left x> <bottom-left y> <top-right x> <top-right y>"

Margin + printable area must remain constant
For me 72 units = one inch (so 0.1" is approximately 8 units)

So:

*ImageableArea Letter/US Letter: "8 8 604 784"

gives the desired 0.1" margin on the print area