Likely to get icing under the fender and clogging. A bike for
winter cycling should have maximum fender clearance possible.
I'm thinking in Ontario you're likely to get those freeze-thaw cycles that cause maximum icing. I have an old appropriately-named Rocky Mountain Blizzard that gives enough clearance for the worst icing situations. To use your measuring protocol, I have a good thumb of space between tyre and fender.