The "Tundra" in Hilton Toronto has very nice food. Canadian cuisine, as they labeled themselves. Rustic stuff but in a gourmet setting.
There's a restaurant near the Sheraton (I think one block or so west of University) called the Monsoon. Nice fusion.
Walk up the old China Town (Dundas and Spadina) area and go into an authentic Chinese restaurant (just follow where the Chinese go). Toronto's Chinatown is much better than NYC's in terms of food quality.
Another road less traveled, take the subway (Sheraton is at Queen station on Yonge train, go north and change to Bloor train, get off at Pape) to Pape (or Chester) and walk around there. Go into one of the ethnic restaurants there.
I'd definitely take a "limo" into the city. Not much more than a cab but lots nicer.
Enjoy YYZ!