Hi Klegacy, I've used Tru-Oil on nearly all my guitars and all my research tells me that water or spirit based dyes/stains are OK but avoid oil based stains. I have used many different brands of stain in both water and spirit based and even some stamp pad ink, all without any problems. Apparently Tru-Oil will react with or to the oils in oil based stains.
I don't use TO on my Rosewood Fretboards, but like Zandy, I have always used Lemon Oil. But there are heaps of alternatives out there. You will have to re-apply Lemon Oil at regular intervals to keep it nice and shiny though. But I have always used TO on my Maple FB's.
I recently I visited a timber retailer at Maleny and they had a couple of custom built electric guitars on display and their Fretboards were coated in twin pack poly. Very nice! But at $3,500 each they should look pretty nice.