I am so sorry that this issue is so upsetting for you.
I truly think that if you have been good parents, she will be an independent and functioning adult. She is bound to make choices that you disagree with, but the tools you've given her over the years will start to be used now, that she is an adult. I am a Canadian too, and travelled all over the USA at 18 and made a few poor choices, sure -- but leaned heavily on what lessons my parents had taught me. I came through unscathed and I travelled in a VW bus with a rock band. Horrors! I am in my 60s now. (I went to University, taught for years and am a successful and happy adult.)
Suggest that she chooses a public place for her first few meetings. Suggest that she has cash on her and a credit card all the time. Remind her that everyone has a sob story and that her priority is to look after herself. If she spends all her money, you'll see her home and she'll owe you every penny plus interest for that help. Taxis are expensive, but safer than any other option after 11pm.
I hope you know that it is perfectly okay for you to say 'no' while she is 17. Same as she gets to make adult choices when she is one. It is also perfectly okay for you not to pay for this trip. Adults do not ask Mum and Dad for help doing things when Mum and Dad don't like the plan.
I also think giving her a credit card with a limit of $500. in case of an EMERGENCY, is a good backup plan. Tell her it is not for drinks, or drugs, or hotel, or anything but getting her home in one piece. It is still not legal to drink alcohol in CA under 21. Please make sure she knows that the US owes Canadians no special treatment and that breaking the law here, is no picnic for non-citizens. She could potentially lose the right to ever travel in the USA if she were to be convicted of drug or alcohol or other crimes. (Even if she is just present when someone else commits a crime.)
Remind her about STDs -- though of course she'll be unhappy about that.
Remind her that it is legal for open carry and (some may carry) concealed weapons in many states. CA is one of them. I have lived in CA and Texas and honestly I am not afraid, but I am concerned and I do think about where I am and what I am doing. (On edit: I am NOT suggesting that anyone carry a weapon, just pointing out that it is very different than say Toronto. I know because I lived in Canada for 45 years and Toronto for 32 of those. I've lived in CA and TX and see people with weapons frequently.) This means I choose to stay completely sober when I am in public or have to take any transportation.
As for the 16 year old girl she is meeting... that does make me wonder. I'd suggest that 'hoping she can get out of her parent's home' means she is still a minor (or worse, is not telling the truth), and that without your daughter talking to the parents and saying she'd like to meet up with their daughter, she is acting like she is not an adult. Adults can live openly and honestly. If there is nothing to hide, there is no reason to lie or not tell the entire truth.
I wish you luck with this. The hardest job left for you is to let go. You spend years taking care of every need or want and trying to teach your child to be the best they can be -- and then you have to allow them to do it.
ON EDIT: The more I read about this, the more concerned I become. The sixteen year old girl has to be visible and your daughter has to have seen her at least through Skype or Facetime and she also needs to consider that IF the girl is exactly who she says she is (though I am doubting it), then she is a minor and your daughter could be charged for interfering with her.
I met people on my travels, but I was prepared and knew to stay in public, have a plan, not drink anything that did not come in a sealed container or to leave a drink unattended. It sounds like your daughter does not have this preparation.
Best of luck with this!