It's been a few years since we were in BC, but I can't imagine it's changed:
1. No. You need to have a full license that has been valid for at least two years. (Make sure you bring it with you).
2. You buy insurance as part of the rental (as you do here).
3. We used Hertz and it was fine. I would neither diss nor recommend them - I imagine they are all the same! (I will be correctly by a storm of protest, I'm sure).
BTW, when we were there (2001), a compact car was a big whale of a Chevy Sabre.
Also, have a look at the rules of the road before you go, as there are some funny Canadian localisms, e.g. turn right on red light if no pedestrians are crossing. The mounties are reputed to be very strict on speeding/bad driving.