Eric,
As this is your first "solo" trip to Europe, you may find it helpful to read Europe Through The Back Door prior to departure, as that has a lot of good information on "how" to travel well in Europe.
I definitely agree with the others that using open-jaw flights is the best idea. Your profile doesn't indicate where in Western Canada you're located, but Frankfurt is a very convenient location for return flights to Canada (either Calgary or Vancouver). I've travelled that route many times.
For the trip from Amsterdam to Berlin, I'd recommend a pre-purchased discount rail ticket. For example, the Bahn.de website currently shows a direct train from Amsterdam Central to Berlin Hbf with a travel time of 6H:21M and Saver Fares of €59 PP. That would be the most efficient use of your limited travel time. Use the extra time in Berlin, as there's LOTS to see and do there!
If you want to buy advance tickets for trips in Germany, use www.captaintrain.com as it's very user friendly and tickets are the same price as if bought from the rail network. They also handle tickets for France, Italy and a few other places.
Regarding Hostel stays you might want to have a look at the HI HOSTELS website and get an inexpensive membership. That will give you slightly cheaper rates and preferred booking over non-members. They usually have several properties in most of the larger cities, which gives you a choice of which part of the city to stay (provided you book early enough). I've found the facilities to be fairly consistent from one property to the next. If your travels take you to Bacharach (close to Mainz), you can try and get a room at the impressive Burg Stahleck castle, which is an HI Hostel property. It's a bit of a hike to get there, but incredible views and nice to have a Beer on the patio in the afternoon sun.
For travel in the summer, I'd recommend pre-booking as many of your accommodations as possible, as it will likely be BUSY in the major cities in Europe.
For Hostel stays don't forget to pack a towel, soap, flip-flops for the shower and a small but robust Padlock for the lockers (do NOT use the cheap TSA locks for that).
You could also consider small hotels or B&B's, which are not much more expensive than Hostels. Have a look at the RS guidebooks for the places you'll be visiting, as there's lots of good information there (including some Hostel listings).