Not sure why the split occurred, but in NSW and Queensland rugby is football (I think it is Rugby League, but it is possible they call Rugby Union football as well), the rest of Australia calls Australian Rules football. Some also refer to the world game as football.
I do not know if Canada has an Australian Rules league, they do compete in the Rugby world cup thou, they are current ranked 22nd, and the best they have done in the world cup is the Quarter Finals in 1991. Canada plays Italy on the 26th Sept this year.