Just some added thoughts:
Canada and USA do most of their development through schools, this is where rugby is lacking as many schools do not care about rugby or see it as a good Spring time option for Canadian/American Football players to stay in shape. This is tied closely to the fact that you cannot obtain a good scholarship, if they even exist to University by playing rugby. These scholarships are what drive sports in North America.
The CIS (Canadian interuniversity sport committee) has talked about starting up a CIS Rugby XV's tournament, it would be very similar to the CRC in the fact that only one team would come from the East Coast (Quebec, Nova Scotia, Newfound Land, and others), two from Ontario (I think), one from the Prairies, and then two from BC (UBC and Victory). The issue has been funds, and timing as the tournament would have to be played in mid to late November which is when the Examination period starts for all universities.
They have also started to set up a 7's tournament for Universities. This I believe will be under full swing in the next year or so as it is a great way for them to bread the Canadian 7's team and they know it. It is also can be cost effective and timing is not a real issue as it can be played in the winter in BC.
As for the CRC and expansion, I have two thoughts:
1. Canada and the States have a very strong tradition of creating good Professional sports leagues (NHL, NFL, MLB, NBA, even MLS on a much smaller scale). So, with this in mind new games have to start to build up a following (Game attendance) because they have no way of getting lucrative TV contracts, when they have to compete with the above. So, it is much slower and harder to grow the sport. Canada is doing an ok job, but I have to admit that USA has really started pushing hard. They realized that 7's is something completely different and provides great atmosphere, the Las Vegas tournament is gaining great following.
2. Canada needs to extend the CRC to the states. Canada is 1/10 the size of the States and adding more teams to our league would only dilute funds and cause more issues, they need to look to the states to provide more competition and lower travel fees. As a point to the Europeans about travel, going from Newfoundland to BC is around an 8 hour flight!