I assume the original post has been figured out based on the date, but using it as an example it should be very simple...

just combine the flatrate + the surcharge into one rate of $14.95 and use it as the Canada rate (and the text description lists it as "Flat Rate $7.95 + Canadian Surcharge $7.00" ) and then set the 'check the shipping country'. If the customer is listing Canada they'll only get the one option if you set your conditions correctly