Firstly, is she totally completely healthy? Are her hips okay? Are her eyes okay? Is her bloodwork normal? Always rule out medical problems before behavioral problems.

I personally think she's fearful: She seems to snap when people are physically handling her or leaning over her. Best solution is to set her up to succeed. Cheerio incident - If this should ever happen again, hold your hand out and offer Chloe an EXTREMELY yummy treat (boiled chicken, for example). As soon as her mind is off the Cheerios (or whatever object she's eating), walk her forward, place her in a "Down", and then let the child pet Chloe calmly. But NEVER let the child lean over or hug the dog. It's just not common courtesy in dog language and I wouldn't push it unless Chloe was extremely bombproof.

Because it sounds like Chloe has fear issues, I would never allow her to be in any situation where she might snap. If your guests are very rambunctious and don't understand dog etiquette (like not leaning over the pup), I would remove Chloe from the situation or instruct the guests on how/how not to touch Chloe. Good luck and keep working on that NILIF!