I'm asking some others on another forum I'm on, to see what they say... I've had 10 replies so far, and the thoughts are slightly mixed... so far... I'm waiting for the experts to spot the post

They'll do so soon hopefully, and we'll see what I get then.
As to Oliver, yes, I do use calming signals. as do others that I instruct to do so, it helps him with that single case, sometimes, as long as there's no eye contact. but if a person is willing to sit quietly, and offer calming signals without looking at him, and completely ignoring him, he'll become curious, then climb on them, and kiss their face... he's a really snuggly, playful dog with people and dogs he knows will not hurt him, though he can freak, if someone other than me, or a dog other than his pack does something to scare him.
He snarls and lunges at strangers, and would bite if given the opportunity, if they look at him, or reach for him... people are mostly dumb when it comes to meeting strange dogs... they ALWAYS look them in the face, and that ALWAYS invokes a reaction from Oliver.
Somethings I can de-sensitize, and somethings I cant, and believe me, I try... I've done and still do everything you've suggested for the plastic bags... I try to make a game out of laundry... I really have no idea why he's afraid of it... he's fine if the bag or clothes are on the floor, but if it's held, rattled or flapped around, he runs and hides. I even tried a game of tug with my t-shirt and socks... I have recently had to buy some new cloths...

as now he thinks they're toys, but if I'm folding the laundry, so therefore shaking and flapping, he hides...
But again, work in progress, and I dont think he cant get over it, he just needs time... alot of time, and patience, and work.
And if you'll check out the threat I posted a couple of days ago about Oliver, you'll see how well he's doing...
But fear can be extreme, and take a long time to overcome. My friend who's a behaviourist told me that Ollie's a perfect example of a dog that would have been euth'd if he'd not come to a person like me, she says I have a very good grasp of techniques needed to help Ollie, and that he's come so amazingly far, and that we will get there... one day.
I'm putting him in an obedience class of hers soon, and we will see. He knows his obedience, and he's very good, but he needs the structure of a class, and as she doesn't allow the dogs in her class to sniff or greet eachother, Oliver and the rest of the dogs'll be safe
Then he'll go into her Canine Freestyle class in the fall... tee hee, that'll be a blast!