Well, it's always a challenge to make sure you haven't hurt another child's feelings.
That said, you have three, no four options:
No party at all: or your daughter chooses one special/bestest best friend to have over for dinner, a Broadway show, etc., etc. Something that is obviously suited for just one child who is also, obviously best friends with your child. Doesn't work if your kid has TWO bestest best friends.
The Big Party: Invite as many as possible for something that is perhaps limited, but accomodates a lot of children. Roller skating party. Pizza Party. Matinee Movie party.
The three or four party that has to be limited for obvious reasons (similiar to #1) The Sleepover. The small party. The I'm leaving out others, but I can't help it or don't care, party. Might or might not hurt feelings, but if you are obviously up for it, then full steam ahead.
Personally, I've never followed the age + 1 rule, because it's somebody else's arbitrary rule. Some children love big parties, lots of friends, and a celebration ( my now 14 y/o.) Others hyperventilate at the thought and prefer fewer friends, not really caring about going to a lot of other parties anyway, and enjoying a more personal experience with fewer people (my now 10 y/o.) Pick the kind of party your budget can handle and your child will enjoy.
Also, in the primary grades, kids tend to have bigger parties. By the upper grades, it dwindles considerably as kids begin to identify with a smaller but select group of friends.
So if you are thinking you will have bigger parties by age 12 or so, it's not so likely to happen. Goes the other direction, typically.
My ten y/o is talking about being sure to invite one particular child to her party next summer, because "she's invited me twice, and I haven't asked her." I do like that my child is aware of this, as we've tried to emphasize that if someone entertains you (generally speaking) you should respond in kind. Otherwise, don't socialize with them. (No playing at other people's houses when you aren't willing to have the same child over to yours, is what it boils down to for us.)
At the age your daughter is now, inviting such a big group is not so necessary, I believe. In kinder, first, and second grade, it will be more of an issue, when the students in her class are together more AND more aware of being together and talking about parties. Also, girls and boys are beginning to play separately, so by second or third grade, there are not many boys at girls' parties, and vice versa. So you are looking at about 10-12 guests, on average.
I doubt anyone will even notice what you do for your daughter's party unless: The preschool class mothers are a tight-knit group who know every little detail and discuss it. You invite all of the girls except one--no matter how many girls there are, this is a hard and fast rule. Your daughter talks about a party to some other girls, which never actually materializes, for whatever reason, and your daughter attended said child's parties. (This has happened to my child, only it was the mother who talked, and yes, we all felt kind of snarky about it, as it clearly ended up being a convenience thing for the mom, who openly talked about skipping parties for her child as it was just more convenient, blah, blah, blah.)
Good luck! And enjoy the party years while you can.