I don't think there's a reason why Canadian production companies can't make $150 mil. movies - but I think producers have to start with smaller budgets and build up to that, because it doesn't seem like the currently established producers have the ambition or the talent to get to that level.
You say Canadian movies are restricted by uneven distribution - but it still seems to me that most 10 million dollar and under movies don't get wide distribution - and the only ones that do stand out quality-wise or marketing-wise.
There are not many popular under 10 million dollar action movies - there are SOME, but they have to pack a real wallop. They NEED to have incredible stunts or have an insanely great script.
This was a case where - in my perceptions as an outsider - a bunch of clueless decisions were made to try and cash in on a popular genre without understanding their market or how the genre works.
The marketing? Here's the poster they made:
HOW could a professional film producer sign off on this poster? It's blatantly wrong for so many reasons it boggles my mind. The stars look like they're high. Not high up on a building, like how it's intended to look - but high as in on drugs. They're both attractive people - how hard is it to understand that attractive people should look attractive on the poster selling your movie? It's not sexy - it's not exciting. Reduced and printed in black and white in the newspaper - which is how most people saw it - it looked like two people standing and one of them was reaching up to get something on a shelf. Because it's muddy - there's no contrast and the straps they're hanging on don't read. EVEN if the straps read in the image there's no tension because there's nothing to show us the physical danger they're suppose to be experiencing. It costs the same amount of money to design a great movie poster as a horrible movie poster - so budget isn't the problem here. It's all on the dumb dumbs who thought they could market a successful movie this way.
This movie also cost Canadians 4.4 million - and the backers probably got a hefty tax return for their failure - so my Canadian pride actually works the opposite way when I see things like this happen.
The thing that really blows my mind is the dude who wrote and directed this dreck was somehow able to write and direct another (relatively) big budget movie. Also a huge flop.
Stepping back and looking at how this movie failed I don't see a picture of Canadians rejecting "Foolproof" because of a perception that it was Canadian and therefore inferior - it was inferior and the producers didn't make it hard for Canadians to figure that out quickly.