The Canadian broadcast spectrum is regulated for the benefit of Canada, not the US.
There was no "flaw" for Shaw to exploit -- RF protection rules are designed to protect a broadcasters investment in serving its licensed area which is limited by recent rules to 100km from the transmitter, no matter how good the propagation conditions.
Under international agreement, stations in each country are only protected within their own country. Don't forget that cross-border audiences of commercial stations do not even count towards their ratings.
From Shaw's point of view, and there were a lot of reasons to favour 14 over other options (4, 6, 9, 11, 12, and 50 are the other existing allotments in Ottawa)
4 and 6 are practically unusable for digital
9 would require an increase in power and agreement from CBC for interference to CKSH
11 needs to protect the CKWS-DT assignment in Kingston, and might not even be possible from Camp Fortune instead of Herberts Corners because of the elevation
12 needs to protect Montreal
50 would require much hihger power than 14 to cover the same area, and would need to protect a 50 allotment in Watertwon.
UHF is preferred because it is much more amenable to Mobile ATSC than VHF.
Most of all, there is some concern that IC might eventually follow the FCC and (try to) auction off the channels above 31. Investing in 14 is a prudent choice, in that case.
Also, don't forget that during the pre-transition era, 14 was in use by a high-power analog station on 14 from Herberts Corners.
While obstructing reception of American stations may be a minor consideration in channel selection, I doubt that it plays a major role compared to economics of operation, amenability to mobile ATSC reception, site location, and preference for a station in the 14 to 31 range.
Also note that reception of Mount Mansfield stations in the Ottawa area is obstructed by a mountain range about 50 miles to the west of Mount Mansfield, so any reception in this area is iffy to start with.
I agree that people in the area between Cornwall and Valleyfield might be affected, but that is not a protected reception area for either the American nor Ottawa stations.