Its in the heart of the dog
Have you ever seen a toy size dog chase down a giant breed? I have and it is amusing. The owner of the giant breed often is ashamed and publicly thrashes their dog for such a humiliating display. Size only matters when it comes to a physical confrontation and sometimes not even then. I have also seen a smaller dog kick a big buff dogs ***.
When a large dog approaches a small dog often the smaller dog feels intimidated by size so may deliver an over the top "don't mess with me" message. Just imagine how you would feel if a t-rex came over to you to say hello. You'd be on guard and try desperately to seem very big indeed.
Confidence comes in many shapes and sizes and some of they most confident dogs I've ever met were in very tiny packages. I have a very confident Jack Russell, all 15 pounds of her. She has only once been intimidated by a large dog and that dog was the tallest of breeds, an Irish wolfhound. It was the one and only time I ever saw my girl roll in submission at a mere approach. Mind you she was only 4 months old at the time and I'm not sure that she would do the same now.
Jessie's confidence makes me smile when she approaches another dog. She walks with purpose and a direct stare which usually has the other dog worrying quite a bit. She makes her position very clear and very few dogs challenge let alone approach her at close range.
You can see it play out when a small dog approaches a large dog. The tiny dog walking to greet with intent body posture while the large dog starts having self doubt. The large dogs ears are up and then down, up and down. Until finally they fold under the pressure literally and are on the ground even lower than the small dog. From there the small dog takes over completely sniffing and keeping the large dog down simply by intense confidence.
Even between large dogs you can see immediately who is confident and who is not. If two confident dogs get together they can have a good time but it is a much more guarded interaction. Add to that "top dog" status seeking behaviors and a good time turns into a time bomb. (Look back at Alpha bitch soup post)
So if you have one of those very big baby type dogs, be happy. These type dogs seldomly get into trouble.