Becky,
Sorry - I just read your posts more carefully and it dawned on me that the raccoon incident really is quite separate from the dog aggression. Catching a raccoon is not going to change how a dog behaves towards other dogs, but it sounds like your dog has been dominant and potentially aggressive (you mentioned lunging?) towards other dogs from a young age.

I have a 4 yr old GSD who is quite dominant towards other dogs - he doesn't initiate aggression unprovoked, but he has to establish that he's #1 with every dog he meets, and he'll get into it if he thinks he is being challenged. Like Randy said, I never let strange dogs "socialize" with him, and I get a little aggressive myself with people who allow their loose dogs to run up to him. He's actually fine with submissive dogs that do not present any kind of rank challenge, but with an unknown dog I just don't want to take the risk. It took some work, but I can walk him at heel off lead past dogs running around doing all sorts of things (I sometimes go to a local dog park to practice training under distraction), as long as they don't come up to us and get in his face. It sounds to me like the problem is not so much that your dog is dominant, as that other people have unrealistic expectations about "socialization" and think that all dogs should be nice to each other all the time. Some dogs just don't buy into that program.

I hope this isn't way off base. BTW the GSD and the old Airedale mutt live together and get along very well (mainly because the mutt has no interest in trying to establish rank over the GSD) and the GSD has done his share of critter chasing too, without any resulting change in his behavior towards other dogs.

I'm with Mike on discouraging dogs from chasing raccoons - they have a high incidence of rabies out here too, and they get vicious if cornered. Chasing skunks is not allowed either, for obvious reasons.....But I confess that jack rabbits and ground squirrels are fair game, not least because they always run a lot faster than the dogs.

I like Cameron's advice on using these classes as distraction proofing. I will use this to our advantage. And I totally agree with Mike about the health of my dog should be of utmost importance. The sight of that poor raccoon dying was not a fun experience especially knowing my dog caused the injury.
We have been doing quite well in Open. My dog has always done the sit and down stay exercises without any signs of aggression, so that's one plus. I guess I just want to be able to relax and enjoy working with her in class as much as I do when we are at home. I'll have to just keep working with her around more and more distractions

One more thing to add: some dogs just do NOT get along. You can "socialize" with 1,000 dogs, and the 1,001 dog will result in a fight.
Take that same dog, don't "socialize" with the first 1,000 dogs, and the one dog will STILL result in a fight. The important thing is what the handler does to prevent and or address the issue. If there are dogs in this class allowed to run up to your dogs, or other handlers trying to FORCE socializing by allowing the dogs to run up to other dogs at inappropriate times (one of my pet peeves about group classes)then saying YOUR dog is aggressive because it didn't just sit there and "take" it, well, I'd have a few words to say to the owner, and even more words to say to the instructor. Bottom line, let the clueless owners "socialize" to their hearts content, just request that it be a specific, controlled time so you may opt out. (As opposed to a dog that shoots over to you before/during/after an exercise, with a nonchalant recall or correction for getting into your space)
Definitely try to stay on the dog to prevent more raccoon hunts, BTW, I was meaning move on from it (in earlier post) because it is not an indication your dog is getting more aggressive, and it was great your recall is that solid. Accidents do happen, but what is important is what you DO about it, not that it happened. Hope that makes sense

I agree with Cameron, socialization should never be a party where all the dogs run free and prance around in happy little circles. Socializing is not a dog party, it is a training session. All dogs should be under control. I have had many of these sessions with Shadow where I have freinds bring their dogs and all we do is walk around with our dogs on leashes. Walking parallel to other dogs, walk facing other walking dogs. Starting at a distance and then gradually decreasing the distance to the other dogs. Getting your dog to focus on you and not on the other dogs.

Call it what you want, socialization, exposure, introducing, contact...whatever, some dogs need to learn to behave around other dogs (or in the perfect world just ignore them). My dogs are in SAR and may be working in close proximity to other dogs. It is something I have worked hard on with Shadow, she has improved but I will always have to watch out for the "1001st" dog.

I think I would talk with a vet and ask them what you should be looking for - I would be concerned even with a dog up on shots as raccoons carry rabies and distemper.