We've been dealing with this, too, as we have a male Cocker and female Corgi who are going on 5 months old. We decided Tosca the Corgi was going to win the dominance contest, but we're not sure. They're still battling it out. Our vet says we need to let them settle this without interference, but I do interfere if I think it's too rough.
Everything you've all described happens to these two - seems like an ear or leg is going to get badly chewed, and then suddenly they're best friends again.I've seen them tussling "to the death" in the backyard, and then they stop and rest. It's so funny! They just flop where they are, heads resting on each other's neck that they were just biting, and then - by mutual agreement - they start in all over again.
I did read one objection to letting your dogs play rough that I found very sensible. If they confront other dogs with the same rough play, someone may really get hurt. We're taking ours to training classes, and we want them to play and stick up for themselves, but not scare littler dogs or get into a real fight. So we holler "enough" and slow them down.
Now would someone please tell this American exactly what a sook is and how to pronounce it???