This thread is really depressing. Stealth was one of the most difficult things to adjudicate in 3E because the rules were not precise.
It sounds like it's the same way in 4E.
I had really hoped that 4E would fix things in this area, given that stealth is pretty much going to be attempted in every single game, given that it's a key tactic of the rogue.
Ken
It's not that hard! Follow the wording of the rules and it works just fine. People are trying to make it more complicated than it needs to be. Let's do a simple scenario:
A party enters a clearing in the woods, finding some hobgoblins around a fire. For unspecified reasons, the party decides to charge. The rogue slips off behind some trees to be sneaky.
The hobgoblins have a passive perception of 15. The rogue has +12 stealth. He wants to move his full 6 squares, so he's at a -5 penalty, bringing him down to +7. The player rolls a 9, succeeding against the passive perception, and moves without the hobgoblins noticing him, stopping behind a tree to maintain his cover.
Next round, he tosses a shuriken into some poor hobgoblin's eye. He is no longer stealthy as a result, and runs over behind some bushes. He attempts to run stealthily, but rolls a 3, so all of the hobs are aware of his presence. One of the hobgoblins (not the one with one eye!) comes out after him.
The rogue wants to keep moving, so he moves again with a new stealth check. He has to run if he's going to get to the next available spot with cover, though, so he's at -10 this time. Lucky him, rolls a 17, still good!
However, that one pesky hob isn't going to give up so easily. He decides to actively search around to find the rogue. As a standard action, he rolls perception in opposition to the rogue's stealth. The rogue's still at -10 'cause he was trying to be stealthy while running, so his stealth is only at +2 while the searching hobgoblin has a +5 perception. The hobgoblin rolls a 12, the rogue rolls a 9, bad luck for rogues.
At this point, the hobgoblin knows exactly where the rogue is. The other hobgoblins have no clue. As a free action, the searching hobgoblin yells, "Fire in the hole!" and points at the rogue. That's all he can do, since he blew his standard action looking around for the sneaky guy. But on his action, the hobgoblins' resident pyromaniac, Scorchy McTwoFingers, tosses a grenade at the spot that the first hobgoblin indicated. Scorchy doesn't see the rogue, and doesn't know the rogue's precise location. As per the "Targeting What You Can't See" rules, Scorchy picks a square in the general location that his buddy pointed out and lobs the grenade.
Unluckily for the rogue, the grenade plops down just five feet away before exploding. The rogue is now on fire, and as per the 'light source' rules under the stealth skill, is no longer hidden. Further, until he gets the fire out, it's impossible for him to hide. Hopefully the rest of the party's doing better on their end!
How else could this have gone? Well, the searching hobgoblin could have decided to move outwards from the ring of trees in the hopes of getting a clear line of sight to the rogue, which would have allowed him to immediately spot the sneaky git. (This assumes that there was enough light for the low-light-visioned hob to be able to see the rogue clearly. If it was dark enough that the rogue was in an obscured square, that would give sufficient concealment to stay hidden even without cover.) If that ploy worked, it would have left the hobgoblin with a free standard action to throw an axe at the rogue in addition to yelling for Scorchy to deploy an orbital strike.
See? Easy-peasy.