Dude, have you any clues to rub together at all? You need to understand risk management much better.
The chances of attack on a ceremonial guard in Ottawa are in the "crazy psychopath" realm, not "trained enemy action". Furthermore, a rifle is a purely offensive weapon - they have no defensive capability against a surprise. Let's start there and go through your points.
If our government finds tracking bullets to be an arduous task, perhaps they are not qualified to have them in the first place.
That's just vacuous. Tracking increases costs - tracking issues of an unusable, yet important-to-track resource makes issuing that resource a total waste. And on't think of just what happens when you sign out the clip. Think of what happens when one goes missing - that's where the costs then seriously escalate. Don't make the ceremonial guard take on the onerous load unless you absolutely must.
What if the gun got dropped and discharged?
Then it's a miserable piece of shit. Only shitty guns discharge when dropped. Spend the money to get them a decent fucking gun, especially if they're your honor guard. There's no honor in standing there with a shitty gun. (The gun imparts no particular honor IMO, but it should at least be decent.)
Do you use firearms much? In real situations? Like even out at the range or in the woods? A loaded firearm is *always* a hazard. One you mitigate with practice and experience, but nevertheless *always* a hazard.
As for the "honour" being diluted? The ceremonial guard weapons are typically of historical interest, and represent their purpose for ceremony - there is much honour in being the ceremonial guard with a ceremonial weapon.
What if you stopped for a picture and someone took your gun
Took your gun? Seriously? TOOK YOUR GUN? What the actual FUCK? You don't put the fucking thing down
And you keep the psychopath from grabbing it from your hands how? Seriously, this is a ceremonial position in a public square. Stop thinking like a Rambo.
Number one thing for you to learn is that accidents are much more common than enemy action when on ceremonial duty. So plan for the accidents, not for the armed assault.
I'm going to stop there as the next few points you make cast insults at the brave men and women who serve our armed forces. Grow up.