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I suppose answers may depend somewhat on where in the world you are. What rights and obligations do humans and dogs have in general, or in certain areas. For example dogs might be forbidden unleashed/entirely in certain national parks. This is mainly out of concern for the wildlife.

But in general, dogs who are out of control and run up to greet strangers should not be unleashed in any area where they may encounter other people. This is unacceptable because you don't know if that stranger is afraid of dogs or allergic. Or how your dog would react when facing another leashed/unleashed dog or wild life. It is IMO particularly unacceptable to have the dog run up to small children - because having a frightening or sudden encounter at early age is exactly how people become afraid of dogs. "The dog is friendly" is a pointless and irrelevant argument.

You can prepare your children (if they are old enough) by explaining dog behavior to them. For example that since dogs can't speak they say "hi, I'm not dangerous" by running up to humans and sniffing on them. And also that a wagging tail and a tongue hanging out generally means that the dog is happy and in a friendly mood. Then your child might have a bit better understanding of what's going on when it happens. At that same time you could teach your children never to pet dogs without the owner's permission.

If you have any such encounter with a dog out of control running up to you, I would as politely as one can manage tell the owner that you would appreciate if they kept their dog on a leash. If you have children with you, that makes the argument even easier to make. Most people are sensible as long as you keep it civil. If it happens again, then I suppose it becomes a legal matter. 

I think many countries encourage you to dial emergency services in case you are out on a trail and encounter _aggressive_ dogs (snarling is aggressive, barking not necessarily) or dogs without an owner anywhere in sight.