The invisible (or cloaked) frog can be found in the 'Below the Thunder' level, just after you get off from the big yellow elevator that takes you up. To find it, as soon as you get off from the yellow elevator you will come to a room. Look at the roof and you will see a metal grate. Shoot that and jump up into the hole. Once in the vents, keep taking lefts till you get to a dead end... he will be sat on a red book 'Croaking while Cloaking'.