This is perhaps the biggest frustration I've heard from dog owners -- what to do about neighbors who don't control their dogs. As you've noted, there's no easy answer.
I've had problems with neighbor dogs on both sides, and I've handled it different ways with each neighbor. Of course, my neighbor dogs don't seem vicious, they just like to bark and give chase.
The first thing I did was to get my dogs from participating in the ruckus. They weren't as aggressive and mean, but I discovered they were often instigating it. They would run up and down the fenceline barking and having the time of their lives.
So I started addressing it with my dogs every single time there was an incident. I didn't turn my back on them when they were outside. If they charged the fence, I was out there breaking it up, putting my body between my dogs and the fence and shushing them away. If they stayed away, they got treats.
When that didn't totally stop it, I started bringing out a water bottle. When they ran to the fence aggressively, they got squirted. I tried squirting the neighbor dogs, but for some reason it just made them more enraged. I decided to stick with training my dogs. Eventually, I didn't even need to squirt my dogs. Just the sight of the spray bottle did it.
The result, after about a month of work, is the neighbor dogs would charge up to the fence and my dogs wouldn't go near them. When my dogs did that, they were rewarded with treats.
Pretty soon, the neighbors noticed what I was doing and started doing the same thing. Now we have harmony again. Their dogs rarely rush to the fence, and my dogs rarely engage. Nevertheless, on the rare times it happens, I'm on it immediately.
On the other side was a neighbor we get along with well, but they own an australian shepherd who doesn't get enough exercise. Wonderful dog, just not outlet for its energy. So I offered to walk their dog. I did it several times and became friends with their dog. I even got them together with my dogs, so the dogs became friends too.
That didn't eliminate the fencing entirely, but it made the encounters less vicious. I used the spray bottle on that side, too, and we now have pretty good harmony there.
It was a lot of work, but I kept the peace in the neighborhood and solved the problem.
If the going is slow, enlist the neighbor's help. Approach them in a friendly manner and ask for their help in solving your mutual problem. A little honey catches more flies
