Ah, I was thinking of dog parks specifically designated for dogs to be off leash in. The situation you describe is how it is where I go. I use county forests or crown land. Under control dogs are allowed off leash. But it's not a rule so sometimes a person will walk their dog on leash too. It's usually not a problem since these are large areas and the dogs and people can spread out.
Except at the pond. There is only one pond and when someone with their dog on leash comes down to the pond they are often discomfitted to see so many dogs, mostly big, running around loose. No one is right and no one is wrong. It is sad for the leashed dog if a group of loose ones go over to greet it and it's frightened.
I can't tell you how many times we've convinced the poor leashed dog's owner to let it off and the dynamics have changed. As soon as the leashed dog realizes it's free to flee if it feels the need it no longer acts defensive and thus the other dogs lose interest in it.