You're overreacting to this.
The PLA has always been a role model in Mainland early-child education. When I was in grade one, all the boys wanted to be a PLA soldier. Playing mock-battles has always been a perfectly common activity on the playground. I remember that I was very surprised when I first moved to Canada that kids here didn't play these games.
Reading your post, I feel that you are injecting your own bias into this. To you, the PLA means war, hatred, and death. Well, to these kids, the PLA means courage and self-sacrifice.
Here's a question, do you think the Canadian Military means war, hatred, and death? I'd be very surprised if you do. So why does it disgust you so much that a school would encourage kids to mimic the military? Just because they're the PLA? Or because the idea of "military" automatically conjures up images of death and suffering to you? Or perhaps a little bit of both?
There is a culture in Canada to divorce politics from everyday life. There's this feeling that politics is for politicians, evening news, and elections. Political discussions should not take place in work places or among casual acquaintances.
It's a useful adaptation for a country where people hold all sorts of different political views. This allows people of different, and sometimes opposing, political views to enjoy each other's company.
However, you have to remember that there's no such thing as "different political views" in China. There is only one political view, and people are expected to adhere to it. The end result is that since people in China don't argue over politics, there is no need to divorce politics from everyday life. In fact, politics is an integral part of both workplaces and schools.
The point is, this has nothing to do with nationalism, it's just a difference in culture. In Canada, politics is a dirty word and kids shouldn't play with guns. In China, politics is a part of everyday life and toy guns are just toys.