[yorkietalkjilly]

Sorry, couldn't fully flesh this out but had some things to do.

When having your dog sit and focus on you with the "Watch me" request outside on the walk when another dog is coming and walking him in a circle or two following a treat in your right fist (if he doesn't stay stay down as the other dog passes), he is learning not to alert to the other dog but to keep his attention on you and what you are directing him to do. Alerting to other dogs and obsessively focusing in on them can lead to excitement and aggression and trying to attack. An offlead dog will come straight for him if he's in that state and if the offlead dog is aggressive or vicious, you and your dog will be in trouble. By keeping him busy working and obeying your request or walking in circles should he rise, it is desensitizing him to the presence of other dogs outside and defusing their power over him. He'll learn in time to just sit and wait and eventually just to walk on by - no need to sit but to focus on his leader rather than the other dog. Training him in this way over and over every day will soon have him much more interested in you and that treat than the dog walking past. You can train poor impulse control out of a dog most of the time if you are persistent and use nothing but positive-reward training.

About the desensitization training to your other dog playing in his presence, you might have to start out with him in a wire crate as you play with the other dog near him. Each day move your play session closer to the crate. When you can play with her and he is lying in the crate or remaining un-alerted and calm in it and at times ignoring what is going on, then and only then, you can bring him out of the crate and start putting him in the down/stay as you play with her and treating him as long as he stays down. If he lays his head down, DOUBLE TREATS - that shows he's submitted and relaxed to the activity in his presence. Have him on the leash during that time so you can control him should he suddenly rise in excitement/aggression. Should he do that, say "uh oh" and remove him from the room during the training sessions with him remaining in the other room for 15 minutes once he's totally quiet. Then he can come out and resume his day. After a while, put him in the down/stay on the leash and back to playing with the female, giving him a treat every so often as long as he stays down. This will in time get him used to controlling himself and learning not to jump up or try to jump on her as she goes about her life. But I would leave him leashed for a good two months after he's trained as the two dogs start to play together or interact with one another. No food, chewies, sticks or toys or other resources out when both are together in a room or outside, either, until he is totally submitted to her being herself and doing whatever she wants with no input from him. With a dog that is a little aggressive in nature, you might always have to separate them when resources are around.