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I don't think you'll find anything great in Toronto...Montreal maybe.
There is a store (green sign I think) just south of Yonge/Steeles intersection, in the same plaza as Popeyes. I recall them having hookahs but nothing that looked good, and seemed overpriced. As for tobacco, happy hunting!
Best option, especially if you're not ordering tobacco/molasses is to order it online through a reputable source. Even if customs do open it, since there are no tobacco products, you get charged the regular duties/taxes (in my experience).
If you're looking for a small/compact hookah, definately take a look at the MYA QT, it gets great reviews.
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