When I say that decisions cannot contravene with Canadian law, that means that they can't break the law. For example, an arbitrator cannot rule that your hand must be chopped off for violating a contract. He can, however, rule that since two parties agreed to follow Sharia in their loan, one party charging interest is a violation of the contract, as an example.
No, there won't be any stonings in Canada, for the time being, but there is no reason to believe that Sharia will exactly mimic Canadian law either.
Arbitrations of any sort do not need to exactly mimic the law, whether in Canada or the US. You can do things like agree to waive your rights to a jury, agree to evidentiary rules that would not pass muster in regular court etc.
Arbitrations are private proceedings, so they can follow different rules than regular court cases.