Thank you for using justanswer. Under the Canadian/US treaty, The total amount of your Canadian pension would be reported on line 16a of the Federal 1040 (Pensions and Annuities) and the taxable amount would be reported on line 16b. In general, if you did not contribute any $ to your pension, or if your contributions were made with "pre tax dollars" then the whole amount would now be taxable to you.
Your pension distribution may also be subject to Canadian tax at 15%.
If any of the income reported on the NR4 is considered to be Old Age Security, then under the treaty, this portion would be treated in the same manner as any US citizen's social security for tax purposes. Please see below:
Information on the United States - Canada Income Tax Treaty
I hope this helps.
You're absolutely correct in that you will a credit for the taxes that you pay to Canada. Unfortunately, you will pay some tax on this $ to both the US Federal government, and the Canadian taxing authority, just as you might pay tax to the US Federal government and to whatever state you live in.
I have included the instructions for Form 1116 (Foreign tax credit) since there are details about your tax return that I have no way of knowing (such as did you itemize deductions, etc)
Instructions for Form 1116 (2008)
I hope this helps