If you're going to lose any levels to racial HD or LA, get the Dark template, it gives just about anything a rogue could want except for ability score increases or means to deal with crit immune critters. And it only costs +1 LA.
Whisper Gnome from races of stone is my favorite rogue race. +2 dex and con, -2 cha and str. Nice bonuses on hide, move silently, listen, and spot, speed 30 AND small size, low-light AND darkvision... They're almost as "broken" at LA +0 for Rogues as Dwarves are "broken" at LA +0 for Fighters, which is saying a lot.
(Putting broken in quotes because I don't actually think you'd be cheating or exploiting anything to use those races as written, they're just very good at what they do)
I know Invisible Blade looks cool and all, but I played one once thinking the same thing and was grossly dissapointed. It's really not that good. Especially if you can't use the author's intended 10 level class with more sensible feat requirements (posted in some wotc thread somewhere). The 5 level class forces you to take a bunch of ranged feats for a class that, while using throwable weapons, has all of its abilities melee-based. And the int to AC in return for no armor is really not worth crap, considering how cheap armor is.
If you want to do daggers or otherwise throwable weapons, look at Master Thrower in C.Warrior. A Swashbuckler 3 / Rogue x / MT 5 is a very effective, simple build. Fighter 2 works just as well for getting BAB, Swash is only really nice if you have high int to add to damage and/or are using the multiclass feat you mentioned.
For any Rogue now I reccommend a 2 level dip into Swordsage at the 9th and 10th HD (8th and 9th works fine, as well as any HD later on, but I think 9-10 is the best point) if you have access to Tome of Battle. That way, you lose 1d6 SA dice from the lost Rogue levels, but you gain Assassin's Stance, which gives +2d6 SA, a net gain. The levels also let you take Island of Blades stance, so you can flank with any ally around you, even if not actually on opposite sides of a foe (you can't use this and Assassin's stance at the same time, though, just a useful plan B). You can also pick up the following two maneuvers for free with those levels, each usable once/encounter, and can be "refreshed" as a full round action if needed:
Distracting Ember: Swift action to create a flanking buddy.
Cloak of Deception: Swift action to get Greater Invisibility until the end of your turn.
Further, with Swordsage levels, you can pick up the Shadow Blade feat, which lets you add dex to melee damage. You can only do it with a few select weapons (including daggers), but otherwise it applies to ALL enemies and is less limited than the feat your DM allowed.
Other basic things: UMD is too difficult to use much early on, but by level ~7-8, you should have max ranks in it (pour them in at once if you like). Once you get to a +19 skill mod, you can automatically use any wand or staff (always DC 20). The versatility and aid being able to use these magic items add to you is indescribable. Keep on raising ranks, though. You'll need to make DC 21+ to use scrolls (DC 20 + Caster level of the scroll, so typically DC 21-37 pre-epic for level 1-9 spells). UMD is IMHO the best "class feature" a Rogue gets.
Don't worry about your dagger's crappy d4 damage. Heck, don't waste too many feats or effort adding ability scores to damage, either. Your damage will mostly come from your sneak attack, focus more on adding to SA damage and means to deliver it. Aside from the maneuvers I listed, look for the Dungeonscape (I think also C.Champion) alternate class feature to swap Trap Sense for the ability to do 1/2 SA damage to undead. Look at the weapon crystals in Magic Item Compendium, some such as the greater Truedeath crystal letting you fully SA undead (costs a whopping 10,000 gp, though). Look for spells to set up sneak attacks. For example, Persistent Blade (Spell Compendium) is level 1 and leaves the target flanked by ANY melee attacker for round/level, and nothing short of teleporting or dispel will get rid of it, generally.
Unless you're doing a major ranged focus, nab the Staggering Strike feat from C.Adventurer as soon as you meet the pre-reqs. It's disgustingly good, and practically required for a melee rogue to survive toe-to-toe against big monsters. It only works on melee sneak attacks, unfortunately.
Just check it
