I agree that the way you handled the situation is appropriate. I suggest that it might've been a good way to handle his aggressiveness all along. I appreciate when another adult steps in when I'm feeling ineffectual with my grandchildren and before that with my daughter. If she didn't like it your relationship may have ended sooner but it is right to protect your daughter. And she might've been relieved that you took control of the situation.
I suggest that you wait awhile so that everyone's feelings cool down and that she may later want to talk with you. Talking together could help clear the air so that you don't feel awkward living next to each other. I also would hope that she would realize that she's not being an effective parent in teaching her son how to behave and might ask you for suggestions at a later date. If she does, have a parenting book suggestion ready for her.
Talk with her using I statements and if she asks, make suggestions on how she could more effectively control his behavior by giving examples without using her child in the example. For example, you could say, "when a child.......I'd try......."
I also think it's possible at a later date that the two of you could still be friends by limiting the amount of time your children are together. I've had "over the backyard fence" sort of relationships that met one or two of my needs. And when your families are both in the front yard, you can talk with each other while staying in each other's own yard if both of you agree to keep the toddlers apart.
You could make a line between them and in fun treat it as a game. "Oh, oh, you've crossed the 'great divide" and the 'hob goblins' are going to come out." as you make funny faces and lunge towards the child. It will take more effort and may not be worth it but it's an idea.
If each mother provides toys for their child I think it might be possible for the adults to be together with the babies and the toddlers playing separately. The boy is developmentally still within the side by side play preference which may be one reason he's so aggressive along with having a mother who doesn't know how to handle it.
If you do get back together later, separate the children quickly when the boy first starts getting rough. You didn't have a chance to do so with this last incident and I say again, I think you handled it well.
Relationships work best when people are honest with each other and stand up for themselves and their children in a courteous way. Too often we feel like we have to be quiet because we don't want to step on toes or hurt others feelings. That feels too much like walking on eggs and when we do that negative feelings eventually emerge and something like this happens as it did with the fathers. I probably wouldn't want my husband to get involved after the fact but I think I understand why he did. Sometimes men seem to react more quickly, perhaps seemingly without thinking, but they also often resolve the issue in a direct practical way as a result. It does sound like it's best for the kids to not play together for now at least.
In the little boy's favor, he told on himself, which makes me think he knew he was wrong. He needed to be told that what he did was not acceptable. The mother apologized but did she ask him to apologize? That is the next step in the lesson. By using the word nice you were giving him a reference point to what is good behavior. Too bad his mother couldn't do that but good that you could.