My group is currently level 12 (in 4e) and rapidly moving toward the end of the campaign. Originally, I intended the game to go from 5th level to about 19th, with the overall plot being a war brewing between the Yuan-ti and the human empire.
At 12th level, I'm feeling tugs between the game feeling too rushed, or plodding along too slowly. By all reason, the game could finish in the next two sessions, wrapping up the major plot and resolving the over-all game. The players are extreemly focused on winning the war, and are moving at an alarming pace.
Going back to the original post, I've experienced exactly this problem reffing the Mongoose super campaign War against the Drow.
In the first book, a major part of the campaign involves a race against time, warning the powers that be about the impending invasions. When the invasions does take place, there are mechanics to take in to consideration the actions of the party up to that time, and how long it took them to warn people. I made this clear to my players at the start of the campaign, as an 'against the clock' element is unusual in my experience, with many campaigns having triggered events so that the PCs can't miss them.
The up shot of this was that the players avoided any mini adventures which did not directly advance their aim to getting to the regional capital, warning them and then helping coordinate the defences of the region. The up shot of this was they failed to get the XP the adventure anticipated and were a much lower level than they should have been. I think this is the lack of character development the OP was talking about.
It's really tricky. When the PCs are masters of their own direction and have been given strong sign posts by the DM that they need to get a move on, any sensible party is going to motor onwards. As others have suggested, you need to throw in a curve ball. Or maybe you could change the sign posting you are giving the PCs.
Maybe you could introduce a crack team of NPC operatives. Have them fight along side the players for a session and completely out-shine them, then send them in to the heart of the enemy only to be totally crushed. That should tell the players they need to do some levelling up before engaging the enemy.
Alternatively, have the war take a strange twist. 'A Darkness at Sethanon' is the third of the Riftwar books by Raymond E Feist and it features an interesting development in the war. The evil army suddenly starts campaigning towards an out of the way city with no visible strategic significance. Why are they doing this? What do they know the PCs don't? This sort of plot twist could cause them to have to undertake some kind of investigation, maybe seek out information sources (the Oracle!) and only then understand what is happening and how to stop it.
It's a difficult situation you find yourself in. If you want to change the behaviour of the players you need to understand what is driving that behaviour then change that with an IC approach.
And never worry, there is always the next campaign...
Cheers
Dan