I don't understand the mentality of people who would put their beloved pet's life in danger by ignoring them like that. I was walking my dog one time and a pitbull came running out to attack. I called out to the owners and they just shut their door. I let my dog off the leash so she could protect herself (3/4 coyote, 1/4 shepherd). She killed the pit and we walked away...I don't get it.
You should have shot the attacking dog and prepared yourself against what the owner would do following that. Glad you made it out ok, but I agree with the other person who says you've played your last ace. Be careful out there!!
If your dog is really 3/4 coyote then its most likely not even legal to own. Your average dog owner does not have the skill or patience, regardless of what they think, to control a wild animal. I can imagine why you just nonchalantly walked away after your dog killed another dog, they probably would have put your dog down had they found out what it was. Did you report it? Did you take your dog to the vet? If it got blood in its mouth then it obviously could have caught a disease or illness from the other animal such as rabies.
If someone ran at you from across the street, would you shoot them? If not then why is a dog any different? If something runs towards you it doesnt automatically make it a threat, it would certainly make me weary but you cant assume its going to attack you until its damn obvious it will.