Utilize a Arduino lilypad for this purpose and do not use the 9v batteries in place of that use a lithum power batteries ,the ones which are used in Mobile phones they are really sleek and slim so that sewing a small pocket for holding the batteries would not be a big think and will not look bad too and they come in various variations in terms of voltages like 3.3v or 4.5v or similar values that is simply pretty much for your implication.
About LED's i would suggest using SMD led's , They are the best for your implication because they will be nearly invisible and when they will light up will have a dramatic effect, while looking out for the battery choices look out for 4.5v' above 1000mAh or atleast this much.