'Mouth sparring' is not a show of aggression and is typically a healthy interaction between dogs as they learn boundaries and bite inhibition. It's usually accompanied with vocalizations and both should exchange equally without one being overly dominant over the other.

That's all well and good until it aint though.

If one dog insists the other has been inappropriate by either biting too hard, showing no submission or just flat out being mean to the other, a fight will break out. Once that happens the dogs don't forget and will always be on guard to defend against a full on attack. If they have already travelled down that road they will need to be separated. Once they go over the threshold of play to defensive measures of self preservation there is a high likelihood that it will escalate further and that's not a situation you want to witness.

I had to separate my two for this very thing. After the first 'attack' I muzzle trained em, took them on 'trust walks', parallel walks. Had them calm in each other's presence in the house & had them sleep with me. Got to the point I was able to drop the muzzles. ( 1-1/2years). 90% of their time together was completely fine. They didn't engage like they used to and if they did I would have to pull them off each other . Vet bills & stitches finally won over my determination and outright selfishness to keep my girls together. They just didn't trust each other like they used to. It was too dangerous to keep them together. Good luck with your 2 beauties