I think in the educational institutions that I'm familiar with in Canada there are a lot of measures in place to avoid copyright violations, some of which I think go well beyond what needs to be done.
There was discussion in some libraries of pulling reserve materials off the shelf of their required readings. There's nothing in the law that would require that. I know that some libraries will not even add certain videos to their collection that you can get in a local public library because of worries about public performance clearances.
For many years we had the access copyright licence sit side by side with fair dealing, and I've written about the fact that I think that fair dealing was often trumped by some of the payments in the licence where it wasn't necessary.
In other words, educational institutions have been excessively cautious, and I don't see that stopping by adding the word “education”.
As to the first prong of your question, I think it would be unwise to try to further define the term “education”, because “education” is a good term. It's a good term to use because it touches the information-seeking needs of so many different members of society. I wouldn't want to see that term narrowed. If a court has to construe a term that doesn't have a definition in the act, as the Supreme Court just had to do with the word “research”, they will use common, plain meaning.