As you'll find, there are work-arounds to hide your Canadian-ness from B&N. If you
don't try to pretend to be American, you'll still be able to register your NOOK via Wi-Fi (anybody can do that anywhere in the world), but the selection of B&N e-books available to you will be very limited.
As for the free e-books, about the only ones Canadians are able to download from B&N are some of those published by Samhain. Samhain's titles are predominately erotica, often with a tendency toward the kinky (BDSM, ménage, etc.). Here's a link to their free e-books at B&N:
http://productsearch.barnesandnoble.....00&PN=Samhain -- at the moment, there are 3 free e-books available to Canadians.
Again, if you go to the trouble to masquerade as American, you won't have the limitations.