Use localbitcoins.com escrow service and use interac email transfers.
Recent experience to share.
#1 with a bullet - do not use "bitboin" (or any combination inovling) as the password for interac electronic money transfers (EMTs). They are now a blacklisted word and will screw things up.
When trying to deposit an EMT with such a password you will get "ER/J/EMT-R-CP-999" which means "block at senders financial institution".
Then, once the sender calls and clears this up - you will get an email from interac.ca saying "The INTERAC e-Transfer from Bob Jones for $123.45 (CAD) sent on xx xxx 20xx has now been verified. Please accept our apology for the delay."
But it still will not work. Error message "ER/J/EMT-R-CP-411" which means "receiver has now been blocked". And the solution is to get the receiver's bank to contact the senders bank in the background and clear it up.
This is the stage I am at now with at least one deal. Hope this helps others.
Edit: Reddit:
http://www.reddit.com/r/Bitcoin/comments/1l4m8h/note_on_buying_with_interac_email_in_canada/
