How to account for goods (inventory) that was purchased, but never actually taken possession of, due to the deal falling through, but I was still stuck with the expense?

This would be reported under the Losses Profile which can be found under the Deductions tab  - Losses Profile.

Thanks. And do I input 'zero' for the line that asks "What was the value of your closing inventory?". I'm worried that declaring something as having value at opening inventory, and then being a complete zero at closing would raise red flags for the CRA...

It's a loss so yes you input zero.

Please review link below to avoid any unnecessary audit alerts:

How can I protect myself from a CRA audit?
https://turbotax.community.intuit.ca/replies/3394573