Do they have a "vice squad"? Yes they do. Administratively it's combined with the drug squad. In practical terms they are seperate. The drug side gets most of the resources:
http://www.city.vancouver.bc.ca/police/investigation/ViceDrugs/index.htm
Priorities on the vice side are child prostitution, child pornography, child expoitation and trying to keep young people out of the drug and prostitution lifestyle. Adult prostitution is not a priority, but they still do get involved from a time to time.
They do still do "stings" (female officer), like the above poster go hit with, and, believe it or not, they still do "reverse stings" (male officer/buy bust), although the VDP doesn't do a hell of a lot of either. Generally the regular patrol units just follow people around and use some low-level harrasment to try and keep the level of john traffic down. If they get a lot of complaints in an area outside of the hardcore hooker strolls (Cordova, Clark, Franklin, etc.) they will do something. Like, if a lot of SWs and SW traffic starts popping up in a regular "Mom and Pop" immigrant neigbourhood in East Van, that won't go on for very long before the police start using increased patrols, stings and reverse stings to send the message that it is not allowed there and you had better get back to your cages on Cordova, Clark, Franklin where you belong!
On entrapment. Entrapment law us fairly weak in Canada. It's a very hard defence to make out. See the following Supreme Court of Canada case if you are interested:
http://www.lexum.umontreal.ca/csc-scc/en/pub/1988/vol2/html/1988scr2_0903.html
"Entrapment occurs when (a) the authorities provide a person with an opportunity to commit an offence without acting on a reasonable suspicion that this person is already engaged in criminal activity or pursuant to a bona fide inquiry, and, (b) although having such a reasonable suspicion or acting in the course of a bona fide inquiry, they go beyond providing an opportunity and induce the commission of an offence. It is essential that the factors relied on by a court relate to the underlying reasons for the recognition of the doctrine in the first place."
Talk to a lawyer though... and don't try and argue this stuff with the police. You'll just get their backs up and it'll make it worse for you. As always, say nothing to the police. Your lawyer will do the talking for you in front of a judge if it comes to that.
On that thing about, "Go to John school or I'll charge you?" Personally I feel that this is bullshit. I would just drive away and throw that pamphlet in the garbage. If I ever heard about it from them again, by way of summons or anything else, I'd just get counsel and fight it (and win easiy, as it is a bullshit case that won't make it through the early stages of the criminal justice system). As a general rule, if the police feel they have the evidence to charge you, then they charge you. they aren't your friends and they don't give a flying fuck what effect it has on your life. I always feel that if they don't issue a Promise to Appear at the time of the incident (or arrest, if it is such an offence) then they are never going to forward a charge to Crown counsel. If it is a murder investigation or money laundering or something, sure, they'll cme and talk to you, do some more work, talk to other people, and charges might come later. But with communicating in public for the purposes of prostitution, they aren't going to waste any more time on it. They have sent their message. They know it's a bullshit offence. That's the end of it.
If you really want to get aggressive you can have your counsel write them and ask them to destroy the photograph they took of you or justify on what legal basis they are retaining that document, etc., etc. You can also FOI all the information about you held by the VPD, although there are exceptions under the
Freedom of Information and Protection of Privacy Act (the provincial public-sector privacy law) relating to police investigations. The police tend to abuse the exceptions in the act quite badly and it is hard to get them to reconsider without going to a judge. Even the Privacy Commissioner and the Police Complaints Commissioner only have some much power over them (i.e., not much).
Bottom line: never give in to anything the police try to do to you. FIGHT EVERYTHING! It's worth it, believe me. In most of these thing they are basically banking on 99% of the people just going along with what they tell them (as if the police are the experts on the law) because they are too scared or too embarassed to do anything about it. Be that 1%.