Killarney is quite a picturesque little town, just as it is described in the guide books. Don't be under any illusions though, it is not where you are going to find 'the real Ireland' (in all its quirkiness I hope you all understand what I mean). This is a tourist town. Period.
The town boosts a quite busy shopping street, with a couple of fantastic restaurants. The shopping is very expensive. My tip would be to save your money and spend it in the major cities of Dublin or Cork instead.
Beware if you are travelling with kids, with its narrow streets and quite a few cars and tourists, it is not very stroller accessible and if going on a weekend . . . well . . . just try to avoid the weekends if you have a stroller.
As a summary, yes, you should see Killarney but don't plan for a too long stay. There are so many beautiful cities and sights around Killarney that you are much better off seeing.