Yes, move closer to work. However, $600k for a place with a Walk Score of only 44 (Cambridge, Ontario) is waaaay too much, in my opinion. I would look for someplace with higher walk scores that would allow your wife to walk, and you to take public transit, car share, car pool, and/or bike to work. That would give you a huge amount of flexibility, potentially even dropping both cars (freeing up $1260/mo, not even including insurance or maintenance costs).
I don't know how old your kids are, but living in a more walkable community means that their activities will be planned in places that are convenient to get to, as opposed to birthday parties, team sports, and practices that assume and require driving. Owning no cars is a completely different mindset from 1 car, and well worththe cost of a $600k home.