I know the fares these days from NY area to Montreal are ABSURD - I actually just paid $500 one way! EWR-YUL on AC because I had a final exam to catch the next day, car was in Montreal and the train was sold out.
But anyway, I am a student at McGill (originally from NJ) and I travel to LAX/EWR/LGA quite often. Though I usually drive home to NJ to fly out to LAX, I have on more than one occasion driven to BTV for a significantly cheaper fare to LAX through ORD. Driving from NY certainly is the best option, but you're right - rental car would be ridiculous. The drive from BTV is probably less than 2 hours, depending on customs of course. When will you be entering customs? This will make all the difference, as I have driven BTV-YUL in about 1.5 hours at 10pm with no customs line. I certainly do not think that it will take over 2 hours, unless there is an enormous customs hold up.
Interesting sights are pretty few and far between if I can remember on that particular drive, but you could always visit Burlington, which has plenty of stuff to do. The problem with Quebec sights is that you will enter Quebec pretty close to Montreal, and the urban sprawl (industrial factories, etc..) that comes with it. Traffic probably isn't a huge issue unless you're gonna be driving into Montreal weekday at rush hour (4-6).
I suppose you will have to do a time-cost analysis. Will the jetblue flight+car rental add up to more than the flight non stop from NYC? Does the car rental have a surcharge for going into Canada (though im sure it doesn't). I suggest looking into the train, even though it is 10 hours! which always baffles me. It is $60 each way, and if you have work to do/books to read it can be quite relxaing (great scenery too). Also, leaves from Penn Station and gets right into Gare Central, so it couldn't be any more convenient really (despite the time commitment).
Hope all this helps!