Yes, you could stay in Toronto. However you might consider other places along the lake: Burlington, Oakville or Mississauga (closest to the farthest) or on the other side, Stoney Creek, Grimsby, St. Catharines or west of Hamilton: Dundas, Ancaster, Flamboro, Caledon. Hamilton airport is at Mount Hope near Ancaster.

You might have better luck trying Stoney Creek or St. Catharines. From my quick search in Travelocity, it looks like there is a Knights Inn in St. Catharines available. The QEW highway runs along the lake through Hamilton to St. Catharines and Niagara.

There is a bed and breakfast association with a map: http://www.bbcanada.com/on.cfm

There are some maps including the World Cycling route at this page: http://map.hamilton.ca/MapGallery.asp

Good luck! Frances Toronto, Canada