After much consideration, I've come to view the ego as our evolved animal intelligence and will to survival. This explains why it is generally attributed to the ego when someone is dominating and selfish. It is the ego that is fearful of loss, humiliation, dissolution, death, and is always seeking control of everything to contain that fear.
Fortunately, both the ego and the intellect can be valuable tools if not allowed to run things. We need to survive, but something very synergistic happens when we can share and work together instead of just hoard and dominate.
Like most people I've had numerous pets - cats and dogs mostly - and absolutely they have awareness and identity and an ego. Cats especially, or at least a much more independent identity than dogs, IMO. Dogs too have a strong sense of identity, but tend to be more socially responsive, due to their innate pack social structure, perhaps.
You would think the more dependent an animal is the more gratitude they would show, but just like people 'rationality' can have very little to do with it. Just like people, animals can be kind and they can be vicious, and everything in-between. I've had some really fantastic, loving, giving pets, and I've known some that were real A holes, again, just like people.
In the case of the toy dogs I think of the situation of a human child that is never told 'no' - it tends to respect nobody and nothing. I have seen a larger dog sternly warn a tiny dog that was being belligerent - and the tiny dog's disposition did a spectacular about face - at least until it could get 10 feet away, where it turned around and started yapping again, but only from a distance from then on. So environment can have a lot to do with it as well.