Daggers and swords are the two best weapons, period (simply because of how many classes they can be used on). Excluding headhunter, you can play every melée class in the game except 1 with either daggers or swords (with daggers you can't play pally, and with swords you can't play monk. That's why most people get either swords/staffs or daggers/axes; so you can melée every class)
There is no damage difference at all between weapons, and if it appears that way now I can guarantee that it'll be fixed in the next update

/e: personally I use daggers because swords were more expensive back when I bought my gear
This post was edited by NevV on Oct 20 2010 11:59am