"Vales and hills" in the line "That floats on high o'er vales and hills" is a merism, a rhetorical device that gives a sense of a range by naming opposite ends.
At the beginning of the third stanza ("The waves beside them danced; but they / Out-did the sparkling waves in glee"), the clause "but they out-did the sparkling waves in glee" extends past the "boundaries" of a single line, so the daffodils' uncontainable exuberance is illustrated even in the poem's structure.
