I am a Canadian student and I did my undergrad at UBC, my Masters at a Canadian school but now I am at a US program for my PhD.
This is the way the Canadian graduate school system works. With very few exceptions, people with BSc degrees enter graduate school as a Masters student, which is normally a 2 year program. You complete coursework, do thesis research and write/defend a MSc thesis in this time. After your MSc program is finished, you apply again for PhD programs and most Canadian schools only accept PhD students who hold a Masters degree (the one exception in Physics in Canada is Toronto, which follows the US model). Even if you are staying at the same school, with the same supervisor, you have to completely reapply. However, in the Canadian school system, it's basically up to the professor if they want to accept you, so there is almost a guarantee that they will keep you if you are doing good work. You just have to do all of the application paperwork (including LORs from your MSc advisor who may also be your PhD advisor) just to keep everything legit on paper.
If you stay at the same school, it's usually 3 more years to get a PhD. Going elsewhere would normally mean 4 more years. So the total time in grad school is the same. Also, Masters students are 100% fully funded, just like PhD students and in Canada, there is very little difference between a MSc student and the first 2 years of a PhD program.
I think this system is a lot better, because you don't have to commit to more than 2 years of your life to one school/advisor/project. Many people change projects completely (most keep the same school and advisor though) after their MSc. A MSc thesis might be the background or prototype project for the bigger PhD work and a MSc thesis does not have to be original work (but it's better for everyone if it is). Also, this allows you to leave after 2 years with a useful degree (not a "consolation prize Masters") if you don't want to stay in academia instead of having to stick around to have anything to show for your work. Finally, if you turn out to be a big disappointment, this means the prof doesn't have to keep you around as a PhD student, but this is very rare.
I would recommend that during your visit next month (I think they still do this in April), you talk to potential advisors and figure out what you want to do. Have a discussion about your future. Ask if this person is looking for a PhD student in the end. Very few professors want to take someone only for a Masters and then drop them afterwards.
As for the "acceleration" program (i.e. skip the Masters thesis/defense and not get a Masters), I would actually not recommend going this route. At some programs (not sure about UBC), it's there as an option but very few people take it / are encouraged to take it. In my opinion, it's far better to have a complete Masters projects (including papers that come out of it) first and then do a PhD project. In most US places, you don't even get to start your PhD project until year 3 or so anyways because you have to pass all the quals, comps, etc. first.
I know it's scary to not be actually enrolled in a PhD program, but rest assured, in Canada, the MSc-->PhD process is very routine and expected for students who want to continue in academia. I think that pretty much all Canadians that think about grad school think about it as BSc -> MSc -> PhD, and I was pretty surprised to learn that in the US, you commit to a 5+ year program right after undergrad!
Feel free to let me know if you have any more questions/reservations about UBC and/or Canadian graduate programs!