just few bits and pieces to your questions:
1. If your father's service number was J86502 he was for sure registered in the RCAF and I am pretty sure if you will contact the National Archive of Canada you will be able to get his RCAF Service Record - at least for the period with the RCAF.
2. No. 37 Training Squadron was from 15.9.1917 based in Spittlegate as a part of 24th Wing using several aircraft types including DH6
9617 should be the serial, maybe with some letter prefix like x9617, known are series Bxxxx and Cxxx of DH6 used by this unit.
Se the link above- 90 HP should mean simply the engine:
90 hp RAF 1a engine
Hope this helps you a little