Blindness is the nice thing here (who wants to waste a daily on minions?) so it makes most sense to use a dagger for the +1 to hit, who cares about the extra 2-4 possible points from using a shuriken? Miss = not blind.
What makes it not broken at 1st level is the fact that it IS, most likely, only using a 1d4 as a damage die. 2(1d4)+4 is only 12 hp damage max, average of 9 damage, min of 6. A lot of rogue attacks deal condition effects precisely because of that low damage die. And secondly, because sneak attack only effects one target per round. That means, out of all the targets you hit, you can only pick one of them to take the sneak attack damage assuming you even qualify for combat advantage.
More likely to hit than a scorching burst, but only usable once per day whereas scorching burst is an at-will. I'd say that balances.