Here's the way we learned to teach Bite Inhibition with ours. This is an excerpt from our Puppy Kindergarten Training Manual we use from St Hubert's Animal Welfare Center, that we used in our classes. I'll probably get introuble for copyright issues, but this really explains alot about this behavior. I'll remove it if any one has an issue with this. We never had to go past the crying out part, to get her to stop.
Copyright March 2003 by St Hubert's Animal Welfare Department
"Puppy Nipping and Mouthing
Most puppies are perpetual biting machines. Puppies often nip or mouth the clothes and body parts of people and other animals as a part of play and in greeting. Puppy biting, although at times quite annoying and sometimes painful, is , in fact, a normal and essential developmental behavior. At this age, puppies are both actively teething and interacting with their new surroundings and pack members as puppies do… with their mouths. Although puppy mouthing is normal and natural and isn’t usually intended to do harm, it can tear clothes and results in cuts and bruises on bare skin. Conversely, the strong jaw of an adolescents or adult dog can inflict serious injury if the dog is not taught to inhibit the force of her bite. Addressing the nipping and mouthing problems in stages will help to teach your puppy to soften her mouth and not use their teeth to get your attention. Be patient. Don’t expect this to work miraculously overnight. Shaping any behavior or eliminating an unwanted behavior takes time. If you are not having success after a month, please speak with your trainer.
• Teaching acceptable behavior. Rather than just focusing on eliminating the biting, you must also think what you really want from your puppy instead. If your puppy nips or mouths people when they try to pet her, try giving her a tasty bit of food or a chew object to occupy her while you pet her, or teach her to sit quietly for a tidbit when you try to pet or greet her.
• Minimizing inappropriate behavior. Never encourage your puppy to grab you or your clothes. If she does grab or nip your clothes, cross your arms and look away from her or walk away from her so she learns that nipping gets no response from you. Don’t laugh, look at her or give in to her play as this rewards the behavior. We do not recommend roughhousing with puppies, since you are inadvertently encouraging her to bite your hands. If your puppy is worse when children are playing, try to keep her separated from the play or put her on a leash so her behavior can be controlled. Never let children tease or excite puppies into nipping and mouthy play.
• When your puppy is biting, you must teach her that her biting hurts. Puppies are very good at teaching one another this through their interactions and play sessions. If you watch the puppies during playtime, one pup might nip at another pup too hard and the “victim” will let out a yelp. The result is, play stops. But, only momentarily. Dogs don’t hold grudges. They quickly resume play and the “bitee” learns to use her mouth a bit softer to keep the game going. We recommend you use the same technique, one the pup understands. Whenever your puppy places her mouth on your body or clothing, let out a very loud “OUCH” so she knows it hurts (even though it doesn’t, don’t let her know the truth!). For some puppies this will startle them and inhibit their biting. For some puppies, it may actually increase the biting. Try to find the correct pitch that gets the point across. After you yell “OUCH”, leave the room for 30 seconds – time out – and return, making another attempt. If, after several sessions, the puppy is still biting, ask yourself how much exercise the puppy got that day? If it wasn’t adequate, this may be the answer. If it was, then discontinue this exercise. You may want to try other ways to punish the biting behavior. Try making a loud sound from a whistle or an air horn. To make any punishment work whether yelping, or loud sounds, you must catch her in the act, not afterwards and you must punish her every time she nips in order for it to work. Pet her quietly or give her a chew toy when she does stop the nipping to reward the calm relaxed behavior. Don’t punish her by hitting, slapping, kicking or other physical means. This sort of punishment can cause fear or aggression or even make the problem worse."