Dogs read humans alot more than many other animals read us. I also recently watched a documentary when dogs and other primates were compared. Not only can dogs understand pointing, they also track our pupil movement to better understand and communicate with humans. For example, even very young puppies can follow our pupils and choose the cup that we look at. Not even other primates do this as well as dogs!
So if they track our pupil movement and know what it means when we LOOK at something, I imagine they can also track our lip movement and know what it means when we curl our lips into smiles or grimaces. These are obviously alot harder to study than pupil movement since they don't always translate to tangible results.