I have a bone to pick with a lot of game designers out there. What’s this about invisibility being canceled just before the person takes an action? That rule is like a politically correct version of game balance. There is no reason that picking a pocket, shooting a bow, opening a lock, etc should cancel out someone’s invisibility. What’s the point? No where in fantasy fiction (ignore the books based on these same stupid rules) is there an example of an invisible creature becoming visible, just because he was going to kill someone else. Was Bilbo visible? Frodo was fighting with Gollum but stayed invisible until the finger bite happened.
OK - So since no sane rule of magic should negate the spell due to activity - How do you keep it fair? Well, it does make sense to me that only those things that you actually possess at the time of the spell would be turned invisible. This means you cannot turn invisible, pick up a sword and have it automatically vanish from view. This also leads to fun situations like a sword “flying” through the air as the invisible thief runs. But this rule is far more important. If you (the one not invisible) can give the invisible person something new, you can mark where they are. We especially like flour. Throw a few handfuls of bread flour into the air, and they will tend to land on the invisible guy like snow - marking where he is. You can also just listen really carefully. You may not be able to know exactly where he is, but you’ll have a good idea of the direction. What about dogs or any other smell sensing animal? In a high fantasy world, there should be dog trainers who train dogs to give an alarm when they smell something but do not see it. Water is good too - Make the person walk through a small stream, and the water will flow around their feet, marking their position. And what’s wrong with fighting a person who’s invisible anyway? Sure they’re tougher to hit and a lot tougher to parry, but you can slash around wildly (just like they do in the movies) hoping to connect. If you do, then the blood drips on the floor and connection itself will make the next attacks that much easier.
Invisibility is one of those really cool, really powerful types of magic, and its power needs to be given back to it! Don’t be the PC Police and downgrade it simply because it’s powerful. Attack it in genre; not with some silly rule!