Jordan, the lady at the MTO doesn't know what she is talking about. A filled in appraisal sheet from any certified automotive appraiser is all you need as well as your signed affadavit petaining to the original purchase.
You do need adequate appraisal services when you get your insurance- pictures and a detailed account of your vehicle. You see, there are two kinds of appraisals my friend; one for the MTO who is using it to tax you and one for insurance purposes.
You should get an ownership right away for any intended resto as you pay your tax based on the value at the time of ownership transfer, even if it is "unfit"; eg a wreck worth $500 plus applicable tax vs a restored vehicle without an ownership that was just appraised at $10,000 plus applicable tax.
Why would you pay tax on tax, afterall you just bought $1000s of dollars in parts that you paid tax on, right???
I would have gone into another MTO office until I found one where they didn't hassle me.
I know the one in Guelph is straightforeward enough and the one in Georgetown is even easier to deal with...