It is an enhancement bonus to hit and damage, same as any other +3 weapon. Additional qualities don't change how the basic abilities work unless they specifically say they do. and the enchantment equivalents are only given on the tables to assist with pricing, they don't tend to use them anywhere else and certainly not in the item description.
That item is drastically under priced though and your GM should feel free to increase it to (18+(4*2)- a little bit for situational) 22K at an absolute minimum maybe closer to 24-26k.
My question is what the +3 pertains to. When I read this I though it was an enhancement bonus but my GM thinks otherwise saying that because it grants the shield bonus that the +3 takes the place of 3 'slots' of special ability.
"3 'slots' of special ability" - I don't even know what this means. What's a 'slot'?
The description is simple, there is no need to overcomplicate this. EVERY magical weapon MUST have a +x to hit and damage. That's in the rules. In the case of this War Lance, there are only two possible +x values (well, one is +x and one is +y). There is the "+3 lance", and the "+2 AC".
Obviously, the +2 bonus is an AC bonus, not a hit/damage bonus, so the other bonus, "+3 lance" MUST be the hit/damage bonus.
If that's not persuasive enough, just ask yourself (or your GM): "if you found a normal, ordinary +3 lance in a pile of loot, would you ever doubt that the +3 would apply to hit and damage?" If the answer is "Yes, I would doubt that" then you guys are playing a different game that the rest of us.
Obviously, a +3 lance adds it's +3 to hit and damage, and a War Lance is a "+3 lance" (it says so right in the description) and that literally means the same thing.