potential customer can give us a picture id unexpired canadian driver license - we are probably not going to open the account without some sort of us picture id, are we too strict?

If your policy says you can only accept a US picture ID, that is all you can do without a board approved change in the CIP policy. Whether you would like to accept non US photo id may be situational - what other id is available, why the individual is in the midwest and does not have a US drivers license (are they there working temporarily for their employer, for example). You would need to assess when and why you would be willing to accept that form of photo id and then make a recommendation to the board.