If the pilot didn't know there was an exercise going on (and I don't know if he knew or not) then he might've been spooked by seeing a lot of muzzle flashes beneath him. He might well have thought all those muzzles were pointing at him. We train our pilots pretty hard but that training doesn't include shooting at them so they'll know what it looks like (unlike the Army where they fire machine gun rounds a few feet over your head so you'll know what it sounds like).

As for questions like the color of the tracers, I honestly have no idea. All of the tracers I remember seeing where white. I don't know if they come in different colors. I do remember seeing many tracer rounds ricocheting off of things and going high into the air. It's at least possible that some of the tracers the Canadian troops were firing were deflected skyward. If that was the first time the pilot had seen live fire from the air, well, it might've rattled him.