Welcome to the forum. My Basu (now deceased) had a history and background much like your dog. He was from W. German working lines. I adopted him when he was 4.5. Initially he was frightened of people but he then became fear aggressive and would try to bite.
I would NOT recommend "military style training" or harsh corrections as they can make the problem much worse.
After lots of training, positive reinforcement and counter conditioning he made so much progress that people couldn't believe it when I'd relate his history...but it took about 3 years to get to that point and I always watched him very carefully because he still took his guard dog duties a little too seriously!
Here's what I did (some of which I see you're already doing):
--NILIF
--lots of exercise and mental stimulation
--training classes (beginning, intermediate and advanced). He eventually got his CGC! I trained him at Patricia McConnell's facility (
http://www.dogsbestfriendtraining.com/index.php) and she's got some great books on dealing with aggressive dogs and understanding dog behavior.
--I carried high value treats with me at all times to work on counter-conditioning him to readily accept new experiences.
--I learned dog language and especially calming signals and learned to read him fluently. Check out this website:
http://www.canis.no/rugaas/gallery.php
--Anyone walking into my home was instructed not to look at or try to touch Basu. I trained him to go to his bed when strangers came to the house and wait for a treat. I then asked people to leave him alone unless he approached them. I instructed people to pet him only under the chin, never on top of the head, and to look away while petting him. Eventually he could handle regular attention from
most, but not all, people. Your dog needs to know that he has a safe space (bed or crate) where he can go and not be bothered by people.
--I did keep him on leash in new situations but recognized that he felt more vulnerable when on leash and so I was extra careful about allowing people to approach him in situations where he was stressed.
--I did daily, positive socialization by taking him to a friendly dog park and allowing him to interact with other dogs and people.
Some books I'd highly recommend:
Calming Signals, Turid Rugaas (
http://www.canis.no/rugaas/)
Click to Calm, Emma Parsons
Go to dogwise.com and search under aggression and you'll find lots of books with ratings. The "Dog Aggression Workbook" is new but looks really good.
Good luck and keep us posted!