The Flametongue sword has an enchantment level of +4 (so it can hit anything that requires a +4 weapon, including Demiliches). Its THAC0/damage bonus varies depending on the enemy type (+1 normally, +2 vs. regenerating creatures, +3 vs. fire/cold creatures, +4 vs. undead, I think).
You can find it on a Shadow Druid guarding the entrance to the druid grove.

But as Avatar says, to get some really decent 1-handed weapons you need the ToB add-on. I've found plenty in Watcher's Keep, unfortunately I won't be able to upgrade them for a LONG time (I'm in Chapter 3 now!)

I was under the impression the flametongue was actually always considered a +1 weapon but did varying damage I may be wrong though.

Two handed weapons are more powerful to balance the fact you don't have a shield in your off hand which lowers your AC by 3 or 4 or a second +3 one handed weapon.

It's +4 to hit, +1 to damage.

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The enchantment level or "plus factor" for a weapon, which determines what it can hit, is not always the same as the THAC0/damage bonus. For example the Flametongue has an enchantment level of +4 though its bonus is +1 vs. most enemies, whilst the Daystar has an enchantment level of +2 despite being +4 vs. undead and evil enemies. (That's why it can't hit really powerful vampires)

You can find out information like this with Infinity Explorer, it's very useful when editing/creating items or just finding out how the Infinity Engine and game rules work.

I stand corrected and now I'm going to have to buy the damn sword back again