Robin,
Dogs fight sometimes. People fight sometimes. What you will learn is Katie's or the other dog's trigger points. Food. Toys. Territories. I imagine there are ways to make things work, for example, with your sister's dog, since you will see them often. Maybe more activities with the dogs on nuetral turf?

I assume the doggie will be alright, maybe stiff or sore for a few days, like we would be. But, remember, it was an accident. And, worse case scenario, you dont let Katie play with her dog anymore.

Hang in there.