Oh that is a very scary occurrence - I've had that happen a couple of times at the park. I can tell myself it may just be an overreaction on my part - I can certainly be an over-protective yorkie mom - but I would not take ANY chances even on some medium-ish dogs coming at my two. You can just never tell if those dogs will be friendly or see your little one as a "toy" or a tasty snack!
The best thing is to definitely keep aware of your surroundings and scoop them up like you did if you sense danger coming. The other owner should have been more apologetic and had better dog etiquette!!