A Dog's Day Out

I had an experience this morning that I hope to not soon repeat. I was taking the dog for her morning walk on the same route that I take her on every time. There is one particular dog that is often on it's walk during the same time that I knew was a ticking time bomb. Everytime we pass each other the owner moves the dog (which is always wearing a muzzle) to the other side of the street, makes the dog sit facing away from us and straddles the dog and doesn't let it look anywhere except away from us. Now I always leave my dog off leash because she is very obedient and stays close even if there is another dog, cat or squirrel near by. So now that I have set this up let the story begin. Ollie is about 20 feet ahead of me and this dog with it's owner comes around the corner. The owner was obviously not looking ahead because they did not move to the other side of the road. The psycho dog (pit bull I might add) bolted for Ollie and broke out of her muzzle and the chase was on. Ollie took off in the direction that we just came from and I was on their heels. Ollie pulls a quick u-turn and is now heading for the house. At this point I have had to kick off my Birkenstocks because it is impossible to run in them and now I'm hoofing it down the road in socks. Luckily she cut across the yard on the corner and the pit bull took a jog around the cars in the driveway which gave me a chance to cut the corner and head off the dog. So now I'm in front of this psycho dog thinking "What the hell am I suppose to do now", so I assume the position of a soccer goalie waiting for a penalty kick and thankfully this dog wasn't as psycho as I thought and stops about three feet in front of me long enough for the owners to get there and get some control over the dog. All I say is "What the hell?" and "I have to get my shoes", that was all I could muster at the moment. So I get my shoes call Ollie back, who is standing at the final turn of our walk, she comes over, I give her some loves and we finish the lovely stroll home.

So now my dilema is what do I do now? There is not another good way to take the dog on a quick 20 minute walk just due to where our house is in conjunction with a major road. So do I leave her off leash so that if this happens again she can get away or do I put on a leash near that house so I can have her close then risk the chance of having Ollie get the leash wrapped around me so that I can't do anything? Advice?