I feel so bad for the owner. Rocco sounds like he was doing what his instincts told him to do, protect his family. He doesn't know a cop from a regular intruder.
I just cannot imagine witnessing something like this happen to one of my dogs. We have 2 working cattle dogs and they stay outside in a run when not in the fields or supervised. (They would NOT be happy living indoors.)
The suspect is completely to blame here, but I wish police officers were better trained/equipped to handle situations with animals. I don't think shooting a dog is the answer.