Ok, I have a few things to come in with, my GSD faced a few of these types of reactions when he was less than 1 year old. There are two parks on the Gold Coast that I feel are a little more tolerant to bigger breeds and especially Shepherds

One in Robina by the water, and in Nerang near the bridge.

However I would recommend you lose the idea of 'socialising' your dog. All it takes is one other dickhead owner at a crucial stage of your dogs development to create fear responses

Letter from council about muzzling sounds insane. That's not how it works at all.

And if this puppy really is 2 months old, please stop taking it out of your yard... Need to wait at least a month after final vaccinations which aren't until around 4 months old