You would need to sew the patch on unless you're using the proper materials and have the correct glue/machine to apply it. I wouldn't worry about leaks. The entire bag is sewn, so it's going to leak anywhere the stitching is (and especially through the zippers).

If you were going to emboider directly, you need to have a large enough panel for them to place the hoop in order do this. Looking at the bag, that will either be the front pocket or the top zippered pocket.