See, this why I'm getting slowly tired of those rule's heavy RPGs. Make a spellcraft check, the shield is invisible, no it is not, etc... In the good old times, it was the GM's job to be creative.
He could have said: "your sword strikes the dragon, or so it seems, but just an inch before its point would have pierced the scales, the blade suddenly stopped as" or "your hit the dragon with a good hard blow, but your swing unnaturally bounced back so that your blade comes dangerously close to your own hide..." or "or blade hits an previously unseen barrier, but with your strike, causes blue sparks to fly through the air."
the GM would give clues and the players would have to guess. but in these days the Gm seems to be the slave of the rules...
Back on topic:
If you consider the spell text rule mechanics, then yes the shield is invisible as described in the rules. Technically speaking, the fighter cannot see it (visually). Now, the fighter could be allowed to make a Spellcraft check (but only if he is trained in Spellcraft) to get a clue.
But could it perhaps be, that this is just for flavor? Well, if the shield is invisible, does it cackle with energy when hit?