I think I must if we are going to get more chicks. I need to know where the weakness in our system was (fence, our dog, her dog, whatever) so that I can correct the problem.
I won't go looking for her dog's head on a pike or anything. This is a suburban neighborhood, not farm land. The dogs are well behaved around my kids and dog, so I won't hold them responsible for coming after the birds. Even if they came into my yard.
In the end, if we want to have the chickens free in the yard, then it is our responsibility to make it safe for them. I don't assume that the neighbor's dogs are as well behaved around the chicks as my own dog is. So it is my job to make the fence secure enough to keep her dogs and my birds separate. I thought it was and now I know differently.
Guys, thanks for all the responses and good support. Nice to have such a great group.
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