Government St. is the piece de la resistance of tourist traps in Victoria - littered with knicknack shops selling tiny overpriced bottles of maple syrup and plastic mountie figurines. Avoid purchasing the native art that you find here too. I won't name names but a number of shops purchase native art from local artists for peanuts and then sell it for extremely inflated prices. This occasionally causes a bit of hostility as you might suspect. If you are looking for some beautiful native art that doesn't have a sordid agenda, try a drive up to Duncan, BC and visit the Quw'utsun' cultural and conference center. They've also got a great online store. http://www.quwutsun.ca
Unique Suggestions: I'm not saying you should avoid Government St. altogether. By all means, take a saunter and look at the giant mountie moose, just be aware that the knicknack you're buying here is the same knicknack you can by in the airport on the way home. There is a pretty decent gelato spot just down from the Bay Centre. Touristy, but good, as is the frozen yogurt bar further up the street. Do also check out Roberta's hats and the toystore. As you make your way further from the inner harbour and closer to Chinatown, the shops get a little less offensive.
ALSO, don't skip out on Murchie's Coffee. It's a Victorian institution. The beverages put Starbuck's prices to shame and the tea selections will blow you away. I also guarantee you won't be able to leave without sampling one of those gleaming pastries in the display cases and I guarantee you won't regret it.
Fun Alternatives: For downtown shopping excursions try Johnson St., Market Square and Chinatown. Locals tend to stick to these areas as well. They still lean a bit tourist, but you're more likely to find a more meaningful souvenir. http://www.marketsquare.ca/
All around the city there are statues of Ocras.
It's cute and one can take as many pictures as the number of statues you find in the city
Unique Suggestions: Visit this site for more information http://www.spiritbearsinthecity.com/index.php/content/overview_vanc.html