Oooo...that's a toughie with the neighbor. I suppose you could tell her that you've heard stories of dogs getting stolen, so you've decided to put a padlock on the gate and apologize to her because she'll no longer be able to come in the yard to say "hi". That way, she can still stop by and make nice-nice through the fence, but maybe not get them so upset when she leaves that they wake up DH? And even if they still wake him up, at least the pups are a little safer and less likely to bowl her over when they get bigger and make a great escape!
"We are--each of us--dying; it's how we live in the meantime that makes the difference."
"It's not what you gather, but what you scatter that tells what kind of life you have lived!"
"Be kinder than necessary, for everyone you meet is fighting some kind of battle."