Definitely do not use a water bottle.
Usually lead aggression is down to fear. The dog has learnt that if he jumps in first and growls the dog will go away so it is really effective behaviour. He is worse on lead because he feels trapped and cannot escape.
You need to change the emotional mood of your lab when she sees other dogs.
Can you get a clicker? For the first few day click and then give your dog a yummy treat. Labs will pick this up so easily.
Next when you are out walking try to avoid any situation where she may meet a dog on lead. Get used to clicking and calling her name when on lead, walk backwards or turn around and get her attention on you and click and treat.
Now go to a place where you will see a dog but you need to be far enough away that your dog will not react. Click and treat. If she reacts at all you are too close just walk away and say nothing.
You will need to do this over and over again for several weeks. Your dog will begin to see that dogs are no threat and that in fact nice things (treats) happen when dogs are around.
Try to get loads of patience and do not push her too fast. This can be turned around with gentle consistent training. Try to stay calm yourself so she realises that there is no need to be worried. Give her time to trust you and get used to the new situation and you will be able to trust her. She may always be a bit worried in amongst dogs but she will learn to tolerate them and be confident with you.
This is a case of if you want a fast result go slowly.
Please do not use a water bottle when she jumps up - she needs to know that when she is around you nothing bad happens. Just cross your arms and turn around when she jumps up - she may try and jump up at you back but ignore it. The millisecond all 4 feet are on the ground praise her , treat are great to help labs learn quickly!
Good luck and lucky her for having you to rescue her!