The service they provide is essentially a canvas. They go through great lengths to provide to the user the abstraction of a canvas. So this would be analogous to a chainsaw company selling a product named "Chainsaw".
Crucially, the USPTO disagrees with you (although, who knows? That could change in the future). Is the company providing a canvas, or a collaboration tool that uses an abstraction of a canvas to operate? I think that you're conflating what a thing is with how that thing is constructed. It is a collaboration tool. It uses a canvas. "Canvas" isn't a generic word within the realm of SaaS collaboration tools, so a trademark on that name, in that context, should be valid.
In your example, a chainsaw company could produce a product called Chainsaw, but it couldn't (shouldn't be able to, at least) gain a trademark for that name.
Would you say that a chainsaw renting company could call itself "Chainsaw" (because it "uses" chainsaws as a means to provide the user with sawing capabilities)?
The generic-term exclusion would apply if and only if the word canvas was the generic -- as in the literal dictionary definition -- of the product.
That's why you can't register a trademark for "electric car" or "autonomous vehicle" or "html web page" for an electric car, autonomous vehicle or html web page business.
If you could, other manufacturers would not be able to describe their goods without infringing your mark. Since the product in question is metaphorically like a canvas, but is neither 1) a heavy-duty, plain-weave fabric; nor 2) the <canvas> html tag, another company could create a competing product and market it without using the word canvas, no problem. Hence, the generic exclusion would not apply.
In your example, a chainsaw company could produce a product called Chainsaw, but it couldn't (shouldn't be able to, at least) gain a trademark for that name.