Banff is a tourist trap... everything is always expensive lol
For a cheap hotel, I'd say
The Driftwood Inn which has everything within walking distance or
Arrow Motel but I've never stayed at either so can't give any reviews.. I've always stayed at the RimRock, but it's pricey.
I would say you can't go wrong with either routes.. they are all scenic in their own sense. Option A) Hwy 1... the fastest route, drive along Fraser canyon, Shuswap lake, and Kamloops. Option B) Hwy 3/Hwy 97 (from Hope)... smaller lanes, go through Okanagan valley, Kelowna, but have to get back on Hwy 1 through Revelstoke. Both routes you will end up on Hwy 1 anyways, and go through Golden, Louise, then Banff..
Some suggestions on things to do if you're not hiking... roam the streets of downtown Banff, Banff hot springs, Moraine Lake, sunday brunch at either RimRock or Banff Springs Hotel, and Aurora if you're looking for nightlife. If you want to go shopping, don't.. lol everything is way overpriced.
Hope this helps.