I wouldn't avoid you, as in walk the other way or do a big detour to get passed.
I don't tend to judge muzzled dogs, as I'm aware of many reasons for muzzling that have nothing to do with aggression.
In no particular order, I would consider:
a) Perhaps it's a dog with some issues, but it's obviously with a responsible owner and under control, so I have nothing to worry about. If I felt this was the case I would probably either ask (if close enough) or watch the owner for signs of how they would like me to proceed, as if training/socialising I may be able to help.
b) The dog is a breed type that must be muzzled under UK law and again - is with a responsible owner who is just doing what they have to do. I would probably be able to judge the breed type and wouldn't assume the dog was aggressive.
c) The dog is a scavenger and the muzzle is purely to curtail it's penchant for eating all manner of foul and disgusting things
d) The dog is a sighthound and if so, the most common reason for muzzling is actually because they have a very ott and distinctive way of playing off-lead that tends to worry other dog owners - although some may be muzzled if not small-furry-friendly.
In every case, given their dog is also on-lead, I wouldn't allow my dog to approach them, as it's poor etiquette and could cause potential problems for either their dog or mine if I have misjudged the situation.
It's unmuzzled off-lead dogs that charge from one side of the field to the other to get to my dogs I'm wary of, not those that are muzzled and under close control - regardless of the reason.