I came on B2 as well, and I landed in Canada as well....almost same story like yours.
You MUST make an appointment with US Embassy in Canada to apply for H-1 visa, your spouse can apply for H-4. If H-1 is approved, H-4 will be (even though your H-4 is pending in the U.S.)
The INS belongs to Department of Justice. The U.S. Consulate is under Department of State. Two different systems. Consulate can overwrite INS for pending cases.