Some people say you shouldn't play tug games with dogs because it teaches them to be aggressive. Other people say that, taught correctly, tug can teach your dog self control. And anyone who does agility knows that tug is a perfect reward. I'm (obviously) in the pro-tug camp. Some of the pro-tug people recommend designating a special toy that the dog doesn't have access to until the human decides to play. And they say that the human should always win. But what's the fun in that? We love to watch Katie dig through her toy box, choose a toy, and bring it over to us. Sometimes when she wins, she "kills" the toy. Sometimes she drops it in front of us for more.
We do have a couple of rules, which we established when she was a puppy:
If doggy teeth touch human skin, even accidentally, the game ends.
She has to drop the toy when asked, or the game ends.
I don't know if this works because we started when she was a puppy. I'm sure her general good temperament also has something to do with it. She loves interactive games--but is that because we taught her to play that way, or because her herding genes condition her to cooperate with humans, or because we just kind of lucked out and got a good dog? Probably it's a combination of all these things.