Congrats on your century, (edit, sorry I mean, 200K) and I'm sorry that incident happened. That is horrible, for all concerned.

However... if a dog chases, it should be contained. For it's own good and that of the drivers and cyclists and animals in the area. What was the driver supposed to do? Apologize? For what? Driving on a public road? Approach the dog? You yourself indicate this can be dangerous. Are you implying he was speeding? On the evidence that the dog died from being hit by a car? It doesn't take that much.

It was the owner's fault, for letting the dog run in traffic. Sad for all, especially the dog, but don't blame the driver. Hopefully the owner will have learned her lesson, and will keep her next dog contained.