After 13 years of outsourcing I can sympathize with your struggle. There are great developers to be found on elance/odesk, for sure, but it takes a while to find them. The biggest problem is actually a simple one - most of the very skilled developers will eventually 'graduate' and start to find clients in different ways over time. In other words, the best developers don't stay on those marketplaces for long. They get tired of giving up 10% of their income and having to deal with the Elance scene. The ones that do stay command very high rates and are picky about projects.

It's good that you are willing to pay a bit more to get good developers because in today's market you have to pay to get quality. There's no free lunch these days.

I have a whole consulting practice helping clients find great developers overseas, and what I see is this:

- If you have a low budget, i.e. just a few thousand dollars, then you are really best off using Elance or similar. In this case, you have to learn to attract the top developers rather than searching for them. The 'hot' developers are busy, and picky about projects so you need to present your project in just the right way to get them to respond. It can be done!

- It's really important to get total clarity on what, exactly, you need. Do you need a single developer who is self-sufficient? Can you manage them? Can you handle time/language issues? What skills do you need, exactly? What can you provide, tech-wise? The more you know about what you need, the easier it will be to find it.

- A very popular model is to take on a developer on a monthly basis. This can be very successful and cost effective, but in many case you'll need to be ready to manage the developer effectively because time goes flying by when you are on a monthly deal. Inefficiency can be very expensive.

- Another model is to hire a company that provides some management for you. This is how my company works - we have offshore developers but provide high-touch management. There is a cost for this, though.

Bottom line is that you can absolutely find great developers, and the first step is probably to start defining exactly what you need, what you bring to the table, and how you want the project/development to work. From there, you can isolate the sources that would have those types of resources and push forward.

Good luck :)