Sounds like fun! I love traveling with my dog so it's always fun after you get the first trip over with and know they will be okay.
As for the barking at people and other dogs-- that's definitely something I'd nip in the butt now. If she was in a bag, like you say, often times they will get a "Napoleon complex" because they feel superior since they are up in the bag up off the ground and 'higher' than other people and other dogs. May I suggest to let her walk on the ground? Unless she is still not vaccinated all the way or something. But it's just a suggestion.