My dog was aggressive towards a friend's dog at home

I agree with Kikaah. The dog isn't being aggressive, her reactions aren't extreme, the two dogs know each other, and they settle down on their own. You need to learn to observe your dog and read her body language. You need to know which reactions are a bad sign. She’s 2 years old now, so she’s maturing and communicating differently. Walk them together on neutral ground to help them calm down. Don’t force them to be close to each other. Let the dogs make the first move. It’s normal for a dog to make a bit of noise sometimes. As long as it’s proportional, it doesn’t worry me. There’s no point in intervening when it’s just basic communication. If she were to corner the other dog and start a conflict that doesn't resolve itself, that’s when you should be concerned. By the way, the fact that she doesn't show any resource guarding with you has nothing to do with how she behaves with other dogs. My dog shares everything with me and is very tolerant of my second dog, but if a strange dog turns up and tries to take something from right under her nose, she’ll snap at their muzzle without actually hurting them or starting a never-ending fight. They are dogs, after all, not furry humans 😅 While you're dog-sitting, you can put your mind at ease by doing what Kikaah said: use a baby gate if the dogs are being grumpy, and prevent any unnecessary conflict by feeding them separately and removing anything they might fight over. This way, they’ll be much more relaxed if you ever have to look after them again. It’s better to be proactive the first few times and then adjust based on how things go.

Get them out for a walk on neutral ground as soon as possible, and ideally do it a few times. Once you're back home, if she starts up again, there’s no point saying "No!"—you shouldn't stop a dog from expressing itself. Trying to distract her isn't necessarily the best idea either, as it could actually create more tension (resource guarding over the toy). If her behaviour is territorial, you could try putting the other dog in a room behind a baby gate so they can still interact safely. It’s also a matter of them getting used to each other, so sometimes just giving it time is enough. Make sure to pick up any food or toys to avoid any friction.