Give me a dagger and the speed of a god, and I'll show you a path of destruction behind me.
That 2nd part, "speed of a god," is the main sticking point of a dagger. Sure, it would be effective on it's own if you could move at impossible speeds. But, if you have those speeds, then a sword or spear in hand is still better. (My vote as the best weapon for a speedster though would be a horseman's flail. It minimizes hand-shock while still preserving a good deal of damage.)
Really, a dagger's true deadly purpose is for performing Coup de' graces attacks against heavily armored opponents. That is, you immobilize your enemy, take out the dagger, and then get it up under the helmet or stab it through the eye-slits. The actual immobilizing portion though is usually done with a sword fight. Because of this, the dagger is actually considered the more deadly weapon than the sword Vs. heavily armored opponents. You need a longer weapon to do the immobilizing part, but it is still ultimately the dagger that deals the finisher, and the dagger is short enough that it's easy to use as a side-arm and keep it ready for exactly this purpose regardless of what your primary weapon is.
Anyway, that's too much realism to apply to the OP question. As for what I think is the coolest weapon, I would have to say the Tsurugi sword. It's a Japanese 1 handed straight 2 edge sword, similar in design to European long swords. That's just the thing. The Tsurugi is abnormally long for a 1 hand sword, which makes most moves you do with it innately a great deal more astatically pleasing.