It's the mentor who's let him down, not you!
You trusted the mentor as a professional person whose sole job is to put your son first. Her idea about the dog seemed great - he'd still get to see the dog around school, and could still feel some ownership. It's the mentor who has been rash, and underestimated the responsibility. She should absolutely have understood the (legitimate) high emotion on your son's and your part re: the dog going away.
Also I think fine to have shown your frustration with the mentor. You'd specifically wanted to do this differently, to protect him until it was a certain way forwards. The mentor let you both down.
I'm not surprised your son doesn't want to see her. His honest response to her now would be anger and hurt.
(How good a counsellor was she?!)
Don't beat yourself up about being upset. You didn't make it about you. You felt the same as your son, and expressed it.
But now you do need to reframe this for him, just so he can function better with this uncomfortable reality.
I'd take the line 'ok well I guess she couldn't cope and didn't understand what she was doing, so it's really best the dog isn't with her. She was trying to help and didn't mean to let you down.'
I'd talk to the mentor, too, about how she sees the way forward repairing his trust in her.
Can your son still have contact with the dog? It may help him, although could be more painful in the short term.
Why does he have to 'of course' be upset that he has a sibling? I'd focus now on involving him in the joy and fun of a baby, which will get even better as his sibling starts to talk, walk, etc. If you do one thing, show him how to love his sibling and be excited about the process of teaching them about the world and being the best big brother.
Presumably you let the dog go so that you could focus clearly on the children, which is also totally understandable. Now do that. Be happy. You did the right thing.