Spraying your dog in the mouth like this is going to exacerbate the problem, not fix it and cause more. Using a combination of tactics including counter-conditioning is extremely important for this. Don't fight fire with fire causing more upset and conflict in your dog in regards to his triggers (other dogs). Please look into B.A.T. training Behavior Adjustment Training (BAT) | Official site for BAT: dog-friendly training for reactivity (aggression, fear, frustration) by Grisha Stewart, MA
and other related methods based upon using your dog's psychology to help teach him to think and relate to the world differently and retain his trust in you!
I got my GSD at close to that age and he acted the same way without previous socialization. I used counter conditioning and training at my gsd club 2-3 times a week. I live in the city, so I really didn't need a dog who was going to be crazy every time we saw another dog because Chicago is a really dog-friendly city!
Read up on BAT and other counter conditioning and desensitization material and make sure you fully understand every step, because it all is based upon your ability to recognize your own dog's threshold and working under that. If you don't do this and try to make your dog obey/accept rewards, etc when they are already past their personal threshold, you will think it doesn't work. It does work every time when done properly!
During training classes, I used a combination of positive reinforcement, encouragement, happiness when he did super well (on recalls, downs, stays, etc) and made it the best moments of his life! Yes, I used a collar correction only if I needed to, but with the same balance of luring with food and reward. In other words, learn to be quick about the correction and "blank acting" like the correction was just some thing that happened! and immediately follow it by giving him something positive to do, to get reward and praise for. Do you see what I'm getting at here? Learn about markers, primary and secondary reinforcers and most especially, the timing of your reinforcements. Training classes not only taught my dog to pay attention to meeeee around all those other dogs while he learned that they weren't going to go for him either so he learned to overcome his issue with others and to trust me.
It was amazing when he stood for the judge and was able to compete around hundreds of other dogs. You will be incredibly proud because it's months of work, not days or weeks. I was even able to take him to the German Shepherd Nationals for the weekend and had a great time with him as spectators!
About his hair loss and skin problems. Umm I don't know why your vet is taking 14 days to come back when the first simplest check for those symptoms for a dog this age would have been for Juvenile Onset Localized Demodicosis, which is a simple skin scraping and look under a microscope for the cigar shaped demodectic mite, which lives normally on all dogs, but get out of control due to an underactive immune system. Did they check for that first already and ruled it out, sending samples for further inspection to a lab? I don't know what it is, but I'm wondering if he/she even checked. Antiobiotics and ketochlor baths sounds like your vet began that regimen in case demodex is the culprit until lab tests come back. It sometimes resolves itself.
What is your dog eating? I swear by organic awesome food, you can study the feeding section of this forum for food suggestions and consider RAW. Feeding a high end dog food saves you all kinds of heartache and different medical issues sometimes. But your dog is 6 months old with a condition like this, which is a concern that it's something deeper than diet, or it really could just be a simple food allergy! I will be interested to know what your vet discovers. Why is your vet pulling baby teeth?