For some dogs it really does increase their anxiety while others it calms them down. Think about it like this. You're wearing a muzzle and know full well should some freak situation come up, you're real serious line of defense is removed because you cant bite. Dogs know this. It increases anxiety, especially if the dog already has some issues. You have removed their primary line of defense so an increase in reactivity is likely if your dog is already reactive. It's basically a mentality of "Must sound scarier so they'll leave me alone". Its similar to my boy Riley. He became reactive after a Saint Bernard almost killed him. He developed an "I'm gonna get you before you can get me" attitude if he saw another dog on walks. We worked with him pretty heavily on it but he never came around.
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Shasta GSD 5/5/10 CGC, ITD, TC
"Dax" Thor z vom Weberhaus CAX, CGCA, ETD, HCT, NCO-1, PKD-T, RATI, RATN, RA, TC 3/18/2013
Zena GSD 6/1/03-2/16/2016
Riley GSD/BC 1/10/05-2/1/2013