My mum showed me this thread, and I created an account just to offer my own two cents.
Theres a few possibilities I could think of: The F-35 Lightening STOVL version: http://en.wikipedia.org/wiki/Lockheed_Martin_F-35_Lightning_II#F-35B.
This would explain why it was hovering around the mountains. Remote Canadian locations would be an ideal area to test the F-35, especially the hover variations, from what I've read of it being able to slowly scour terrain with it's sensors and then fire on enemy targets is one of the big selling features. And they are pretty damn big, and very, very, very agile.
Secondly, it could be a stealth helicopter under development. This would again explain the shape and movements. The US has experimented with these in the past and could easily do so again: http://en.wikipedia.org/wiki/Boeing/Sikorsky_RAH-66_Comanche
Another thing, weather balloons do indeed have lights on the bottom. While it might not have been a weather balloon, there are many scientific packages lifted into the higher latitudes of the Earth to study winds, atmospheric conditions, radiation, ozone, etc. Many of these can fly quite low and move very strangely. They have lights to alert local air traffic from a very dangerous collision. As for lights, being a balloon, there is a lot of ways the lights can be reflected inside so it looks very distorted, appearing much bigger than it really is.
The other thing it could be is...well just keep your eyes out for some Men In Black. Especially if they have a talking dog: http://www.youtube.com/watch?v=pCRFJFLfBVc#t=0m22s