I too am a Canadian applicant for some American schools for Fall 2008. In speaking with one researcher, I got the impression that "officially" Canadians are treated as international students, but in the minds of the review committee, we are treated like domestic students.
For example, at Princeton, the deadline for application is December 15th for International students, but December 31st for domestic students and Canadians.
Obviously, for the purposes of the State Department (visas, etc.) we are international students, though even that part of the process is "easier" for us. When I asked the researcher I was talking to about the visa situation, he said something like "Oh, hell, you Canadians are practically domestic students. The paperwork is way easier for you than some of our students here."
For example, a friend of mine who started a physics Ph.D. at an American institution in Sept. 2007 didn't have to apply for the F-1 visa the "official" way, with a visit to the embassy, an interview, etc. He just had to show up at the border with the paperwork and the application fee, get fingerprinted, and he was on his way. The proof of financial sufficiency was not a problem since his fellowship was listed on the immigration forms as income! (Even though he never saw a dime of it -- the school just paid it to themselves, so to speak.)
About grading: I went to Queen's University for engineering and we got all our marks out of 100. I didn't even try to convert to a 4.0 GPA system when applying; I just reported everything as a percentage, just as it was on my transcript.