Can someone please explain how I should setup shipping modules for this situation?

Please tell me what steps to take to setup shipping properly (what modules to use, etc) given the following:

I have a mixed product line (physical and digital goods).

I want to setup different rates for the US, Canada and everyone else.

Shipping cost is based on amount spent.

SOME products offer FREE SHIPPING but to the U.S. only. And I guess this is obvious but the digital goods will not charge shipping to ANY country.

Are there any specific settings that need to be set for the actual product for free shipping?

This next bit might not be shipping related but I would like to just show some products to certain countries. For example, 1 of my products is available to only the U.S. and Canada.

I thought that maybe setting something up in the add/edit products area to allow me to list the countries the product is available to, or leave blank for all countries... like: ca,us

Then employ a script such as: http://keithjameslock.com/wordpress-geo-targeting-script/ that determines the 2 letter country of the shopper. Then... perhaps within the SQL statement that displays products put in criteria for the country? I have no idea how many instances of the SQL exist within the code but is that do-able do you think? Or is there a built in solution to achieve the same?