Red velvet in Toronto?
if you are not picky, the best deal are the cupcakes at Costco. Tried some last week - cupcakes were huge and moist.
I typically don't go for gourmet cupcakes. I tried Magnolia and a few other places in NYC and other fancy places in the San Fran, Austin, LA and Calgary. Not really my thing. But I would buy the ones from Costco.
Maybe others can help.
I'd think Wedding Cake Shoppe is the best bet. They often have the Red Velvet cupcake in stock (maybe call or tweet to them first, to confirm), and they'll bake whole red velvet cakes to order. https://theweddingcakeshoppe.com/Our-Flavours-c-256/?order=256
Bobbette and Belle also sell red velvet cakes. Might also check Caffe Doria.
If you're asking which restaurants have red velvet cake on their menu then Donatello does as I enjoyed a slice for my dessert a couple of months ago. Donatello is a splendidly old fashioned Italian restaurant on Elm Street. It's also splendidly quiet, so you can lean back in your chair while continuing to enjoy a conversation with friends on the other side of the table. Exactly how long it's been there on Elm Street I don't exactly know but it's been there for some while now. It reminds me of Bellini's on Yorkville which closed a couple of months back.