How not to be a good neighbor

This morning was pretty much the norm for the last 5 months. Got ready for work and then took the dog for a walk around the block. Shelby likes to talk to the dogs (and rabbits) that are out in the morning and I know which houses are likely to have "friends" for her to talk to. I try to keep her from barking too much since it's usually before 6:30. There is one house behind us that has a little white dog that is frequently barking at us at the front screen door.

As always, Shelby immediately starts barking and pulling on the leash at the dog. I had about 6 feet of leash to work with so she was at least a few feet onto their front lawn. Instead of calming their dog down, the woman that lives there, opens the front door and lets their dog out. I couldn't believe it. At that point all I could really think about was getting Shelby away from their dog. I was more concerned with the fact that Shelby is pretty dog aggressive and didn't want something to happen to either dog. Meanwhile I hear the woman yelling at me about getting my dog off their lawn. I couldn't let that one go so I yelled back and walked on, fairly pissed off.

Obviously they don't care that much about their dog, since who knows what could have happened if Shelby was aggressive to the point of attacking their dog or the other way around. I realize that Shelby was on their property, but I always pick up after her and is it really worth it to come across as an asshole neighbor to start a fight about it? So now I'm pissed and trying to figure out how I'm going to handle this. I'm not going to take a different route to walk and I'm not going to do something stupid.