The Canucks did not have a Boston tea party. They kept many of the colonial masters' quaint systems. As in England the first 2 letters identify the country and that only leaves the last 2 to identify the airport. Works fine in a tiny country with few airports but in a large country with many airports you soon run out of logical combinations.
I believe there were other airports built earlier in the Toronto area that used up the logical combinations. YYZ was on the scene later and by that time they were down to the end of the alphabet for choices.
Lear45XR: I'm not sure about the Y and W points but a 3 letter ident. starting with a Z is a private airport as in ZBB (Boundary Bay Airport, south of Vancouver)