Would some one help me on a correction question please

Hello Everyone, I'm a Canadian West Coaster with a 6 year old male Eskimo Rescue Dog who was surrended because of neglect and abuse. He's a wonderful dog with me and people he knows, but is a handful when meeting new people and is difficult to walk. He lunges at bikes, men, large dogs and sometimes children. I have had assistance from 2 trainers but he's not co-operating with the lessons we learned together. Today I made him sit and go down (not to his liking) sevreal times when people went past us. I would then praise him and tell him what a good dog he was for not lunging. Is this a valuable training technique or an I going to make him more aggressive. It's his natural nature to be a quard dog but I don't want this going on continually when I'm walking him in public.
The first trainer had me give him treats when unsettling situations arise - this is not convenient with poop bags, keys, arthritis in my hands, ect. The other instruction was to tell him to "leave it", works partly but is not a cure all for this reactive dog.
He has been through Obedience Classes.
I've been going through these 2 processes for a year and a half with out complete success, is there some one out who could offer information on how to correct my dog and have him learn the drill. He's a clever dog although a year and a half is a long time to go through this nonsense.

OK, the first thing you do is not put him in a situtation he can't handle. Don't walk him in places where there is a chance of a situation arising where he is going to react. I know you don't want to hear this but if you want to be successful, it is necessary. Now since you can't take him on normal walks around the block, take him places where he can see his triggers from a distance. There will be a distance that he can handle it fine. Start at that distance and GRADUALLY shorten the distance in very little baby steps. If your dog reacts, take him further away for 10 feet or more and start again. However, the goal here is for the dog never to react. Each reaction is a step backwards in his behavior modification. Each time you can work a little closer and you can take the dog home without reacting at all during the whole session is a victory. Continuously praise and give some treats while the dog is acting as desired. When he reacts, treats and praise stop and you move further away.

Places you could take him would be to shopping malls were you can begin far away on the outside edges of the parking areas. It would be nice if you had a mall with a PetsMart so he could also see dogs from a great distance.

This is a very long process and it won't happen over night. Google the term "counter conditioning and desensitization". You will find A LOT of reading material and instructions on these processes. Don't be upset with the dog. He isn't doing this to upset you or to purposefully misbehave. He is doing it because he thinks its necessary to protect himself or you or both.