The dog should be put down or moved to an owner that doesn't have children and knows what the hell they're doing.
If your niece was older it'd be her fault but at two it really is the adults that were at the scene that caused this.
Any animal (including humans) can get annoyed and attack. They shouldn't have allowed your niece to do what she did as its dangerous and she will have unfortunately learnt the hard way that you can't just be aggravating and not expect consequences.







