How to leave graduate school without pain
Some thoughts:


Don't decide what you want to do with your life on the basis of not annoying your current supervisor. If you really want to stop at an MSc then do that, but if you really want to do a PhD with a different supervisor then see if you can do that. Or you might decide you prefer the freedom of a supervisor that doesn't much mind what you do.
Your supervisor is a professional. There's a chance they'll be really nasty, but it's more likely they will behave properly and sign the form, even if that isn't what they personally want.
Lying is not a good path in Canada (well, not for most people at least).