In answer to your two questions:
(1) Sometimes as pets, but usually for security or guard purposes.
(2) They do have guide dogs. I know one young person who as a guide dog, and that dog as special permission granted, so that it can enter a local mosque.
Regarding the minicab driver, this is not an isolated case. Quite a number of taxi drivers have been prosecuted for not allowing guide dogs into their vehicles, other taxi drivers have been fined and had their licenses temporally removed. Dogs for the disabled can cover a whole range of different disabilities, which can cause confusion with bus drivers and other public service vehicle drivers and users.