Ah, Panama. A fun place. I've been three times since my friends retired in Boquete in Chiriqui province in the west part of the country.
A day and a half is about enough for a canal tour (allow a whole day) and maybe a visit to the former Canal Zone or the old part of town, Casco Viejo. I'd say a Canal Tour is a must. We took an all day trip and enjoyed every moment of it.
Have stayed at the Marriott and Caesar Park (Starwood) - I highly recommend the Marriott, a lovely property. Marriott is much better located - in the center of the financial district; the Caesar Park is part of a convention center and not really close to anything much. Or, if you want to go downscale a bit, you can get a room for much less than one of the US chains would cost.
Please see
http://www.dgolds.com/oldsite/Panama/Panama.htm for some ideas. Drop me an e-mail if you would like to chat.
[This message has been edited by dgolds (edited 07-06-2002).]