You have to leave North America within 3 months
I know the US is powerful, but I really doubt they can require you to leave North America. I think you're reading something wrong.
The US can't make you leave North America, but if they find out you're in violation of a visa waiver (e.g. if you transit back through the US on the way home), then they can deny entry.
I don't understand. If you fly into the US, then enter Canada via land crossing, they will stamp your passport upon leaving the US, thereby terminating your automatic tourist 'visa'. When you return to the US via land crossing, they will give you a new passport stamp.
Note that it isn't illegal to enter the US for two months, and then spend two months in Canada. It's just that the US won't let you back in until you've left North America. How exactly (or even if) they know you've left North America, I have no idea.
From what I can turn up, you are correct about the Visa Waiver Program. Once you enter the USA, your 90 days begins ticking. The one and only way to reset it is to leave the region of the USA, Canada, Mexico, and minor islands.
It appears, however, that if you skip VWP in favor of of a B-2 tourist visa, you can renew this upon reentry, with no hard-set limit on renewals.
As in all things, everything is up to the discretion of border patrol. It seems that while reentry renewal of a B-2 visa is considered normal, they generally want you to go back home for six months out of the year.
That said, the process of going to the US was every bit as onerous as described, being asked questions multiple times, being subjected to a backscatter scan (which I declined and got patted down, tested for explosives, etc), etc.