You might want to take a look at some of the threads over at Canadian Couch Potato regarding taxation especially in their White Paper.
Up to you, but if you're planning to stay with TD, I wouldn't be in any big rush to convert to ETF's, especially if your plans are to do monthly contributions. Dan Bortolotti says past the $50,000 mark in a portfolio and Andrew Hallam says it wouldn't be worth the hassle until you get beyond $120,000, so take your pick. The TFSA I have at TD is "all" e-Series funds. In the RRSP, I have a mix of e-Series and ETF's. The e-Series make it easy to mop up distributions, $100+ at a time.