1) I would stick to wipes cases. You can find them at Walgreens, CVS, Walmart...not sure if you have any of those in Canada. You can also find them on eBay.
A) I would not use a pencil case because they are so much bigger. You'd use more ribbon and it's pretty pricey as is.
2) Hot glue works just fine for me. Just make sure you're using high temp glue sticks.
3) Pricing: and I say again...PLEASE price them robustly. Ldelzer did a breakdown on costs and it's generally over $10 JUST for supplies! Let alone your time. If we all keep the prices fair, we won't shortchange the market for these. I sell mine for $25-30 depending on embellishment.
Let me know when you get your ribbon!