OT: Questions on proposing marriage and buying a ring...

My GF and I have been going together for 6 years, and it's "understood" that
we'll be getting married.  I've decided that I'd like to propose to her at
X-mas time, as a surprise.

Unfortunately, I'm unsure how to go about this, and need some guidance.

1)  Do I choose the ring myself, ensuring that it is a complete surprise for
her when I propose with it at xmas?

2)  Do I propose to her verbally ahead of time, and buy the ring later?


There is a third option, where I can take her "ring shopping", get an idea
of her tastes, but this removes the element of surprise - If it comes to
this, I'd much rather take a more direct approach.

Also, how much is a reasonable amount to spend on a ring?   I'm thinking
$5000-$10000(CDN), but lack perspective on just how much a ring should cost.
My girl's not a materialist, but I'd like to give her something above
average without going over the top.  What is the average expenditure on a
marriage/engagement ring?

How is marriage proposed, particularly in a situation where it is already
understood we will marry?    Is it done with a ring in hand, or does the ring 
come later?

Which is the more important ring, wedding or engagement?  Proportionally,
how much should be spent on each?