I know this post is older so I hope I'm not breaking any rules by responding late!
I've trained several dogs for stagework, obedience, etc. but Ellie is the second service dog I am raising (I'm owner-training, too!) and even with my lab I let people be fun and exciting until the critical period was over. All of my SD community friends who have raised German Shepherds have been VERY adamant about making positive experiences with people for their puppies. I think that once they reach about 16 weeks and have had positive experiences with every type of person under the sun, then start enforcing "no attention from anyone but me". They sell harnesses, vests, leashes and bandanas that say "in training, don't distract" for this! I'd recommend using something other than a vest for early training since the vest will be a "Service Mode: ON" switch eventually.
If you live in a state that grants you public access and you decide to do some early PA, I would not allow any interaction with humans in public or with a vest on even before 16 weeks (whether or not puppies should do PA this early is an entirely separate convo). At parks and whatnot, free game for pets! I always keep my puppy close to me and if someone approaches to say hello, I give them instructions before they can come near the puppy: do not make eye contact or pay any attention until they are in a quiet sit, give a treat, stop any attention if jumping happens. Your dog is going to come in contact with humans later in life when out of vest, and this will make perfect practice for when they are in that situation!
Once they are past that critical/imprint period and their cortisol levels even out, they start to learn that you are the only one they can pay attention to but remember that all of those people walking around them aren't scary!
Everyone likes different training styles though! That's just my two cents. The idea I've gotten from most trainers and vets is that German Shepherds have been bred to herd and protect, so it is extremely important to socialize them well during early puppyhood. A traumatic experience during this time can ruin a dog as naturally sensitive as the GSD. GSDs are also bred for intelligence, so your puppy WILL pick up on giving all of his attention to you and ignoring others. They have to know that other people aren't scary first though.
Hope this helps! Please update me on your progress and feel free to PM me! I'm always learning from other owner-trainers as well so I would love to make a new OT friend!
EDIT: Puppy class is AWESOME!! It's like continuing education for bite inhibition and proper play skills which is absolutely essential. This will also help them have good experiences with puppies of all colors, sizes and volumes...lol. It is extremely rare that puppies fight, so I wouldn't worry about that! If you're with a good trainer, I would even continue with group classes into adulthood. They're great practice for what you're afraid of - that wariness of other dogs, humans, etc. A good trainer will ensure that everyone in the class is well behaved and has no aggression issues.