That's the sketchy part to me.
Was the dog a true "service dog" or is the guy disabled and the dog is his pet. There is a difference. A "service dog" is allowed; the pet of a disabled man wouldn't necessarily be a "service dog."
Either way, the woman's being just plain mean to refuse the guy his dog...unless the dog showed signs of abuse when she accepted him.
He walks with a cane. Shuma assists him. Is he a true service dog, I doubt it but he does aid him in his disability.
As you said, either way, the chick is plain mean.
I do think some people now use the term "service dog" a bit loosely. They try to get their dog into an apartment or other facilities as a "service dog" that treats high blood pressure, because studies show pet owners have lower blood pressure, or whatever. Not every health benefit conveyed by dog ownership makes a pet a "service dog." But you are right-- even if this dog isn't what I'd call a bona fide service dog, the woman should return him! Geez, like there aren't enough dogs without homes in the world that she could get another one?