Just a couple of things to clarify, GSD's are not field hunting dogs. They are not bred for it and making comparisons between a hunting lab or spaniel and GSD is not a good comparison. Doesn't mean that a GSD couldn't do field work, but it is not the breed to consider for serious hunting and retrieving.
As mentioned, when exposing a dog to gunfire the best thing to do is to put the dog in drive. The "drive" can be for a reward of a toy or a bite. With our K-9's we do not reward with a bite during gunfire very often. I want a gunfire neutral dog, not a dog that wants to bite the first person he sees firing. In my line of work that can have disastrous consequences. For sport it is fine and pretty normal to have a dog be agitated or aggressive to gunfire, much like a whip.
Different guns, different calibers sound different to dogs and people. A shotgun fired in the distance, especially a 20 gauge while rabbit or squirrel hunting is not going to freak many dogs out. Combined with the dog in drive to hunt, chase the prey and retrieve is going to bring a dog past any negative experience. As mentioned earlier, a very positive experience is associated with the sound of the gun fire.
Firing a handgun, especially a larger caliber like a 9mm, 40 or 45 close to a dog can cause problems, especially when there is no reward in place. I have seen genetically sound dogs, dogs with no environmental issues become gun shy from exactly this. Dogs that have seemingly had no prior issues with gunfire. Firing rifles around dogs, like an AR can certainly cause problems. Unless you are going hunting with your dog on a regular basis, there is no need to over condition your dogs to gunfire. If you do it once, from a distance, get the reaction that you want then reward and let it go. If you have a good neutral reaction that's great, it won't get better with repeated exposure. It very well might get worse.
One thing that I have seen is that a dog may have a stable reaction when exposed to gunfire as in the OP's video, the first time. The dog doesn't know what to expect and what is going on. Once the dog has time to think about it, or if the next exposure is not done properly, then you may have serious problems. I've seen this with strong adult GSD's on a bite where the decoy erroneously fires over the dog's head. The dog works through it and the next time may have an aversion to the gunfire. Then the "trying to fix the problem" begins. A problem that was created by poor exposure and a mistake in training creating a "training scar."
One last thing, if I am shooting and wearing ear pro then my dog has cotton stiffed in his ears as well. If it is too loud for me to be in an area with out ear pro, it is too loud for my dog.
Just my 2 cents, FWIW.