At first i tought the path would be trash, since it granted barred all evocation, offering only +2dc on enchantment, illusion, necromancy and HIPS at lvl 20, and some synergy with SD but no spellslots for SD levels. .
Also, later on i realized using the Shadow conjuration version of fireball FAILS so it really means it when it says NO evocation
So i started seeking ways to make it work, and this is what i came up with:
The wizard class doesn't have hide and move silently as class skills (obviously) BUT the Palemaster does. So I took the gift that grants +4hide/ms at class creation, plus two skill focuses on hide and ms at lvl 1 (human).
I went 4 wizard, 3 palemaster, and from them on wizard. Used the first 3 palemaster levels to dump skill points into hide and move silently. Add some items, high dex and you can get a reasonable high hide/ms at a very low lvl.
Wizard and palemaster pile up for undead summons, wich lets me get a decent summon for my bucks. Also, palemaster grants spellslots and caster level at odd levels, so 3 palemaster lvls is just like taking 2 wizard levels. Thus my spell progression is only slowed 1 lvl, put on par with a Sorceror. Not too bad for what i'm getting!
Now to the crux of the matter. NO EVOCATION. I know taking fireballs off from a wizard is like chopping an arm, but once you think about it, it's not the end of the world.
Remember, if you go to the high lvl area tossing down fireballs and Isaacs, monsters are going to aggro you to death, and you'll die pretty fast. A lot of time it's not the WORLD DESTROYING magic that trashes monster rooms, but the spells that you use to protect yourself topped with a sprinkle of damage and disabling.
Spells like CLOUDKILL are now EXCELLENT monster killers, particulary if you use shadows or undead which are imune to poison. Cloudkill has this hard-coded effect that makes it so if you'r imune to some of the effects, you'r imunt to all of them. Some poison imunity, and you'r imune to your own cloudkill and so are your undead and shadows. Also, since it was recoded, it drains 1d4+1 constitution with a fort save for half. THIS IS HUGE.
It means Cloudkill ALWAYS drains constitution unless the enemy is imune to ability drain or poison. Have you ever cursed those poison traps that leave you at 3 con and make your HP go from 200 to 33 ? Well Cloudkill can do that against the enemy while your summons are fighting them. It keeps draining constitution, thus reducing fortitude saves each round, making ITSELF harder to resist. Also, if you have some more spellslots, you can toss a STINKING CLOUD on top of the CLOUDKILL. Stinking cloud is fort save vs stun, and is also a poison effect. Thus Cloudkill makes it harder to resist each round, while your undead can chop off the enemy.
Now what about undead ? Well necromancy is a VERY GOOD way to deal with them, either with DEATH TO UNDEATH or summoning your own undead, which are imune to whatever they bring and can hold their own. Also, control undead is a nice perk to use. Remember UNdead will saves are generally and simply put, the worst.
Now what about enemies which are have the common undeath imunities but don't register as undead ? Well, on Arelith some of these are also imune to evocation, and those who are not can be dealt with by the Flame arrow spell which is conjuration magic, and does GODLY amounts of single target damage.
Finally, Shapechange, and tenser transformation. Tenser's is an EXCELLENt spell, cast haste and a lot of horrid buffs like mestill's acid cheat sheat and let them chew on fake temporary HP. Also, you can empower and maximize it to get some outreageous amounts of hp. Shapechange also works very well with this specially the golem morph.
Now i'll take a fourth palemaster lvl later on, to dump hide and move silently AFTER i get HIPS, and to get two uses a day of summon greater undead, so i can summon 3 undead for free twice a day and complete my undead summoner build.
So, i think the shadow mage does works the way it's built now.
HOWEVER....
There is the case of asking oneself. "But why do I take the Shadow mage ? I could get the same results with a regular mage, keep evocation, and just skip the palemaster and it's undead summons, and dip 5 shadowdancer lvls for hips. All i loose is the undead summons and some +2 DC on some spells that don't work all the time". And i can still get 2 undead summons with the wizard's summon greater undead and 3 once a day by using mummy dust even if i don't get palemaster free uses of summon greater undead and create greater undead that summons 3 for free.
The difference would be only marginal, i mean +5 caster lvls a shadowmage would get from shadowdancer levels are not that much because getting evocation back is NOT a small deal even if you can do without. Also, and finally, if you become a specialist wizard to get extra spell slots, you'd get 2 barred schools instead of 1!
And sadly you'd be right. While i absolutely love the novelty of it, there isn't THAT much going for it right now. I agree on buffing it up a bit if that's the Dev Team's intention.
**EDIT, corrected this, i got some mechanics wrong and couldn't follow all my own ramblings in the final conclusion
It should all be correct right now.
What did you enjoy the most ? 
Super limiting! I know so many of us say evocation is dumb brute force, but i must say the better alternative of having o'l nuke-to-the-face vs not having it, is quite challenging. Bigbies, incendiary cloud, igms and Firebrand. Without those things available for metamagic, your spell component costs SKYROCKET, because not that many lower level spells are that useful. 
Yes definitely!