Hi Liz. You have a couple of issues.
Your size in pixels has nothing to do with your print size. If you send the printer more pixels than it can use there is no quality loss when the print spooler takes all the pixels it can use and rejects the excess. It is a better approach than sending it too few pixels.
Your panorama is in the wrong width to height ratio to print an 8 X 12. Your panorama would print 8 X 19.27. If you want any other size you have to crop it first to the right ratio. If you tell us what image editors you have someone can give you instructions for getting the print cropped and the print size set without losing any more pixels than necessary.
The lines are caused by the camera using a different exposure and/or white balance between shots. If you are using panorama mode on the camera I am a little disappointed to hear that Canon doesn’t fix the parameters with the first shot. I had thought only Pentax doesn’t know how to make a panorama mode.
Autostitch will stitch them without lines. The demo is odd. It is full featured but expires after a month. Unless they have changed it you can just uninstall it next time you need stitching and install a new download.
http://www.cs.ubc.ca/~mbrown/autostitch/autostitch.html
Newer versions of Photoshop and I assume Elements will also even out stitch lines. I find it a little frustrating as I usually shoot panoramas with a fixed exposure and WB. Photoshop doesn’t do as clean a stitch as I would like because it attempts to even out what doesn’t need it.