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It sounds like Buddy needs a kennel or a playpen with a top on it unfortunately. Now that he has figured out he can jump out he is likely to continue this behavior because it is rewarding to him. My own puppy discovered he could climb his play pen at a young age! I purchased some thick plastic garden fencing and used it to put a "roof" on his playpen to prevent this. Another option would be a large crate if you want a bigger area for him to play in. They also make very tall playpens for larger dogs, but be sure that Buddy isn't actually climbing the side of the pen before you get one of these!
A crate or crate training is never a bad idea. It can also serve as a safe place for Bella (as you have stated). It doesn't need to be huge either, just big enough for her to lay down, turn around and stand. Make sure there are no sharp edges and that the bars are close enough together so she cannot get her head between them.
It will all depend on his temperament! Big dogs can get along with small dogs just fine but it does depend on their personalities. Make sure they meet in a neutral area (so not your yard that your small dog "owns." It wis probably a good idea to take the bigger dog on a hard walk to wear him out and also have a helper with you. If you are scared, have them meet with a fence between them first. You can absolutely train him to a kennel still. Lastly, make sure your fence is high enough and in good condition. It's pretty tough to train a dog not to jump a fence. One option is to get an underground fence and run the wire along the fence line. Most dogs will respect this system and won't try to jump the fence. I also recommend to do some reading about Labs in general. They are typically very good dogs but they do require some exercise. I hope this is helpful and please feel free to post any additional questions.
I would recommend getting a different cage or one that requires two fingers to engage a spring. Dogs are unable to open the cages that have the springs in my experience. These are similar to cat carriers that have the spring loaded mechanism on the door. I hope this helps! Please let me know if you have any other questions or concerns and I would be more than happy to help you further.
Thanks for using Boop by Petco! I honestly recommend you consider a crate where she is able to walk inside and at least turn around inside. This basically means for a German Shepherd getting the largest crate possible. Best of luck!