Do Canadian ATMs charge extra fees for cash withdrawals on foreign cards?

Check with your bank to be sure, but I would say Yes. I use the Bank of Nova Scotia, and since it's part of the Interac network, I can go to a CIBC or Bank of Montreal machine (or a white label machine in a convenience store) and get cash. The other bank tacks a service charge on which can be 1.50 or 2.00. I would think at a minimum you will be treated the same. This has nothing to do with currency conversion, just with using each other's machines.

However, ask your bank. When I went to Europe, BNS gave me a list of European banks whose machines would not put a service charge on me -- by using those machines, I avoided all kinds of charges. Of course, there were times when I just used the first machine I could find. Something similar may happen depending on where in Canada you're going - the reason I use CIBC machines sometimes is that there is one 20 minutes from my house, but the nearest BNS machine is more like 40 minutes away. Sometimes saving 20 minutes each way is worth $2.00 to me.

Ask your American bank which ATMs you should use in Canada. For example, if you have a Bank of America account, then you can use ScotiaBank machines with no ATM fee since they are both members of the Global ATM Alliance (though the foreign currency fee still applies).

Royal bank of Canada ATM's don't have fee's (at least on Mastercards) plus they are the most common to find. There is one in every Farmaprix.

You probably should just invest in a good international traveler's card, usually in the form of a credit card. If you absolutely have to get cash, do it before you arrive in the country you're going to be staying in, and get all of your money converted up front. You'll pay a premium for exchanging into the local currency, as they know you'll pretty much have to suck it up and fork over extra to use paper money during your stay. If you do it in a different country, however, you'll get a better rate.

As for ATMs, you should set up a distinct savings and checking account. Money transfers from savings to checking are not charged with a fee, and gives you an extra layer of protection if your card is lost or stolen (you should only have enough money on your bank card to get you through the day, and move money to it as you need it). So if someone does steal it, they'll get, at most, a hundred dollars ($50, if you're a broke traveler like myself). Plus, the currencies are converted digitally, so that you won't be charged a "conversion fee" for using, say, US dollars in Canada.

See if your bank is one of those that will refund ATM fees.

I went to Vancouver recently and used the hotel's ATM to withdraw cash with my Capital One card. They tacked on a $2.50 CAD fee. When I logged into my Capital One bank account later, I was pleasantly surprised to see a "Refund ATM Surcharge" line item for $1.98 USD (the equivalent of $2.50 CAD). I had no idea they had a policy to refund ATM fees.