The dog had no confidence in her handler to keep them safe. The poor dog decided to react with the first thing that she knows which was to try to scare us away since mom was clueless to the "danger".
This is exactly what Kira was doing when she was nipping people at the party. She accepted the guests at first, because it was expected of her, but she was never entirely comfortable... she sensed danger, and Daddy was oblivious to the "danger", so when she reached her threshold, her doggy brain said "Someone has to do something about this dangerous situation, and Daddy's not going to, so *I* am going to have to do it!"
My point with Doggiedad, was HOW does one know they have a " go everywhere dog"? Many people take their dogs to dog parks, until something happens. Doggiedad seems 100% certain that nothing could happen. Why is he so confident?
Is it genetic? From what I've learned from you and many others, it might be.
Is it the handler or owner? Did I do this to my dog? Seems like a good possibility.
Most of it is genetic. Kira has weak nerves. That is genetic. She's improved greatly as she has matured, and learned how to handle stress--up to a point--but it doesn't undo her genetics. Because you continued to put her in stressful situations, she's gotten somewhat desensitized; she's done the best she can. Did you "cause" her weak nerves? No. Did you make it better or worse? On the whole, I think you've made it better, but you've seen what can happen when she's put into a situation where she's pushed past her threshold. Have you done irrepairable damage? At this point I don't think so, but if she continues to be pushed, you're likely to see more aggressive behavior come out. If she learns that aggressive behavior can solve her problems, THEN you have a bad situation on your hands.
Honestly, not every dog is a "go everywhere" dog. In fact, a lot of GSDs are not. How do you know which dogs are "go everywhere" dogs and which are not? Dogs with weak nerves are NOT. Period. Any dog that shows fear or aggression in a seemingly normal situation should not be pushed into the role of a "go everywhere" dog.
Why is it OK for your dog to run with 25 dogs in a dog park? Is it because you know your dog's tolerance level, or you trust the other dogs to behave? Either way, there's always a chance that something could go terribly wrong.
There's always a chance in life of something going terribly wrong. A plane could crash right in the middle of the dog park. But if you KNOW your dog, you can have some sense of what he can and can't tolerate. How do you know? By watching his behavior. If Doggiedad's dog has been well-socialized since day one and has never shown signs of fear, nervousness, aggression, or stress, it's fairly good bet that he's a stable dog with strong nerves. Kira, when placed into certain situations, has shown fear, nervousness, aggression, and stress since day one. That should have been your first clue that she may not be a "go everywhere" kind of dog. Sure, she can ride around in your truck, go for walks, play with friends, normal dog stuff. But, as you realized, she should not be put into dog parks, she should not be forced to put up with a lot of people and commotion in the house, and I wouldn't take her to sporting events or things like that.
Dogs are just like people in this regard--some people are social, outgoing, and confident; they love parties and social events. To other people, such events are stressful. Some people are shy and introverted, and prefer to be alone, or with close friends in a small group. Nothing better or worse than anything else, it is what it is, and should be respected. No use trying to fit a square peg in a round hole.