You my friend need a ranged weapon, your other choices are just fine though!
Oh, trust me, I have it all figured out. Devour the stuffed 'shroom, doubling my size, then grab the dagger and lunge at whatever invader has happened to sneak past my defenses. Once they've been eliminated, I'll toss their corpse over the back of the chocobo and ride to freedom. Once in a safe place, I sacrifice their soul to C'thulu, gaining its favor and increasing my power.
Thereby diminishing its usefulness to that of a common throwing knife. More than enough to take out any invader. All I need to do is aim for the jugular.