I'm not sure what happens with targeting if the whole team is stealthed.
I know that if you're fighting a team and they have a single remaining character left that's stealthed you can still cast single target skills on them because the game automatically selects them as there's no one else to target.
This same thing might apply if everyone is stealthed.
I don't have any of the stealth characters to be able to comment on the viability of that team set up though.