Truthfully, a 1 year old doesn't need, and won't understand, a bash! It will be stressful and way more stimulation than she can handle! She won't understand the big party, and she will get all whacked out if you have lots of entertainment likes clowns or ponies or whatever. Same with the other kids. They are too young to understand that the birthday child gets gifts and they don't.
We followed the "rule" of family only for a few years, then at 4 we started with a party of 4 kids. 5 kids at 5, 6 kids at 6, etc. I wasn't interested in having 30 kids, and I didn't want my son to get 30 gifts, and I wasn't interested in having him go to 30 parties all year for the other guests. It turns kids into "gimme monsters" always wanting presents and goody bags, and it is stressful and expensive for parents. Then you get into the competition thing - who spent the most money and had the most outrageous moonwalks, magicians or whatever. That ultimately spills over to Christmas, Sweet 16 parties, bar mitzvah blow-outs, and so on.
You can have wonderful parties with family and a few friends - it's nice to separate the family from the school friends too. We got books from the library and played a lot of old fashioned games the kids had never seen - treasure hunts (as they get older, use clues), potato races, etc. We did themes - one year was dinosaurs (we used all his toy dinos as decorations, made a dinosaur shaped cake, etc.) and another year was insects (my son was really into bugs - so we played "Pin the Stinger on the Bee" and I made cupcakes which I arranged like a giant caterpillar and decorated with licorice strings and candies to make legs and spots and antennae. The kids had a ball every year. My son is extremely social, not greedy, and we didn't go broke over the years. We celebrated relationships and quality time, and did some education while we were at it -- rather than policing huge groups of kids overstimulated on sugar. I wouldn't do a thing differently!
Good luck whatever you decide on!