The problem I ran into was that when they got a little over an inch tall they would fall over and the stem right above the root would be shriveled up. I managed to grow one of them into a small bush a little over a foot tall, but it ended up dying after a little over a year.
I'll have to give it a try again sometime soon paying more attention to the temp and possibly try scarifying a few.
Scarification is not necessary for germination. Newer seeds (darker in color) will have higher germination rates, but even very old seeds (I'm talking more than three or four years old) can eventually germinate when under the right conditions. In my experience, the main factors are the type of soil and, of course, water.
Syrian rue seedlings are very sensitive to overwatering, excess humidity and particularly to soil fungi. Use sandy sterile soil, with good drainage, and make sure there is good airflow to avoid a too humid environment. The method of watering seems to be very important. Seedlings do not like getting their stems wet, and I found that moderate watering by pot immersion (or careful watering in the surface, avoiding to soak the seedling stem and the cotyledons) gives better results. Also, types of soil that stay moist for days are no good. allowing the surface of the substrate to dry between waterings will help them stay clear of fungi. Otherwise, as you described, the seedlings will fall over and die due to excess moisture in the young stem.
You can always dillute some copper fungicide (or hydrogen peroxide) into the irrigation water as prevention measure. Once the plants are past the seedling method, the survival rates increase notably.
Also, be careful with excess heat. Spring weather is most likely the ideal for syrian rue germination.
Good luck,
Mandrake