Overnight kind of City
"This just isn't my favorite place..."
Kamloops is a medium sized city situated at the meeting of the #5 (Yellowhead highway) and #1 (Trans Canada) highways. As such, it sees a lot of overnight tourist traffic and there are no shortage of hotels and motels along the #1 highway through the city.
I personally think that there is not a whole pile to do or see in Kamloops, unfortunately. The reason I say this is because my step-children live there, and we regularly drive out to spend a weekend there with them. We have a hard time finding something to do with them, besides watersliding at our hotel.
It is conveniently situated as a roughly halfway point between Banff and Vancouver and that accounts for most of its tourist traffic.
"Gateway to Vancouver"
When you leave Kamloops heading west for Vancouver you have 2 choices for a possible route there. The first is the newer Coquihalla highway. This used to be a toll road, but the toll was lifted summer 2008. This road was built as a short-cut from Kamloops to Vancouver. It certainly does cut a great deal of time off the old route. The 2 downsides that I see to the Coquihalla are that the road is very busy (to the point of being dangerous) and it is a less scenic route. But if time is a factor to your vacation, it is the best choice for getting from Banff to Vancouver. The drive will take approximately 10 hours, using this route.
The other route choice is the old #1 highway. When you get to Cache Creek, you have to turn and continue south on the #1. This is a twisty, turny narrow highway with a total of 7 tunnels between Cache Creek and Hope. It is incredibly scenic, travelling through the Fraser Canyon. The Hell's Gate Tram is situated along this route as well. If time is not an issue for you, I would highly recommend this route from Kamloops to Vancouver.