Well, if you want your object to be COMPLETELY invisible with absolutely no trace of it, there should be a visibility actuator in the logic blocks. (This is at least in the version I use, 2.48a, I don’t know which version you’re using)
Just set the logic blocks as: invisibility power-up/button->visibility actuator.
As for fiddling with the materials…I think you can do that with key frames, but I have yet to try. Can someone else back me up on this method?
If you open up the “outliner” view in a window, disable the “renderability” icon next to the name of the object. This will make the object invisible during the game. No need for a logic brick: