Is it courage or lack of intelligence to run right up to it and sniff it?
Good question! Dogs will sometimes do really dumb things if they don't have any natural caution; but we humans don't seem to want a lot of natural caution in our GSDs. We want them to face a threat with no fear, caution, or tenativeness... of course, sport is highly ritualized and the dogs are trained to the point where they know they won't get hurt. But Police dogs may very well be hurt or killed in the line of duty.
But we all like our dogs to be brave, fearless, and willing to put their lives on the line for us. We as humans value this courage, breed for it, and encourage it... but is it really good for the dogs themselves?
A prime example of this would be the fighting Pit Bull. These dogs are bred to have the highest level of fearlessness and willingness to fight, even if it means they will be seriously injured or killed. This "gameness" is highly valued and sought after. A "game" dog will not quit a fight even when he is losing, or in fact even dying. Basically, in biological terms, the dog has no natural sense of self-preservation. In the wild, this would spell their demise as they would attack any living creature without fear, even a pack of wolves or a bear. This of course is suicide for the dog.
It's an interesting philosphical discussion.
There are also some breeds where there is a fine balance between courage and self-preservation. I'm thinking of breeds used for hunting wild boar; these "bay dogs" must have the courage to find the boar and hold it at bay without attacking it, and will avoid being attacked themselves. This self-preservation is valued, as wild boars are extremely dangerous and good bay dogs are expensive. The hunters will then bring in a "catch dog", often a Pit Bull, to attack and hold the boar, as these catch dogs have no regard for self-preservation.