I was watching the last episode of Liberty, the American Revolution on PBS early this am, and one of the quotes was that with the dispensation of the monarchy, egalitarianism became common very quickly in America. A third of the prerevolutionary population had been indentured servants. A few years afterward, there were virtually none or very few. Also gone was the notion of deference to one's betters. Everyone was equal. Abigail Adams went to the Court of George III with her husband, John, the first American ambassador, and her letter about presenting credentials at court was revealing. She didn't mince words about the royal family's tendency toward corpulence, and the rudeness and bowing and scraping so foreign to her. My point in all this is that Canada never handed the monarchy its walking papers and in my humble opinion, that's why what America does affects Canada so...and not the other way around. Canada is a giant of a country, still shackled to the monarchy, the notion of royalty and all that that encompasses. Just a thought. Don't get mad.
In a modern Canadian context, the monarchy is pretty much an excuse to have pretty letterhead. But you do have a excellent point, there is a certain degree of paternalism in Canadian politics that is not present in America, and shouldn't be present here either. It's also connected to the more modest goals of our government. "Peace, order and good government" is a LOT different from "Don't Tread on Me".
Having a monarchy, or a government deriving it's legitimacy from a monarchy would put a higher premium on stabilty than it would freedom, and that might be the source of some of our problems today.