I don't think even Canada cares.
I've seen government sites and documents that still call the various aborigines 'Indians'. Most of the way through school they were referred to as Indians as well, much to the chagrin of native students.
I think I've learned more from a friend of mine in highschool about his peoples than from school itself.
They did a
census CPS supplement survey (page 18 table 4) in 1995 asking American Indians whether they preferred the term "American Indian" or "Native American", and around 50% preferred "American Indian" while 37% preferred "Native American". I don't think a census survey like that has been done since. The term "American Indian" has been around for so long, and it's in so many treaties, old laws, and documents, that in many ways it makes more sense, with more people choosing to identify with it. Both are stupid terms, since "America" is an anachronism (though there isn't really any other valid word), and being called a "native" (at least in my opinion) has similar or worse connotations than the old geographical mistake of "Indian". "Native" also doesn't make any sense when you consider that anybody born in the US can call themselves a native as much as anyone else, but that doesn't make them a "Native" with a capital 'N'.
It's the same sort of PC malarkey that goes with whether "African American" or "Black" is better (and in that survey it incidentally also shows "Black" being favored) where I think people assume one term may be offensive when it isn't, and end up using a term that's in some ways worse. Not to discredit your personal experience with it though, my point is just that "American Indian" isn't considered racist by most, and is more often the preferred term.
Edit: Oh, you guys were talking about Canada.