If you haven't gotten Good Owners, Great Dogs, order and read it asap. It will help you with some of these issues.
I know he's just had surgery, but even so, no free hugs for him right now, he has to earn them. See the post above yours, and Brian Kilcommons and Sarah Wilson discuss this in the book, too, calling them "doggie push ups".
In the dog's eyes, your hugging him for no reason puts him above you. That has to change. Everything is on your terms. And that goes for everyone in the household, you all have to be consistent with this.
It's not as bad as it sounds; it just becomes a way of life. When he does what you want, you praise him. Verbally makes life easier. "Good boy." Always and immediately, so he begins to make the connection that you approve. When he doesn't do what you want, or does what you don't want, say No, or make the ACK noise above (I do those two things too) so it gets his attention and he stops. Then you make him do what you want, and when he does, you immediately praise. Each lesson ends when he does what you want successfully.
Another key is to re-direct him immediately when you see he's even beginning to *think* about doing something he shouldn't. Show him what he should do, instead, and praise when he does. It becomes instinctual when you do it enough. Last night I watched some video I took at a dog park yesterday, and I would've probably sworn I hadn't said much of anything while there, but I heard myself saying "Good boy" every time my dog acted nicely with other dogs and ignored those who were in his face, etc. I am so used to saying those words I don't even realize it anymore. But the dog does.
Start there.
Another book I love, particularly for German Shepherd development, is The Art of Raising a Puppy by The Monks of New Skeet. It might still be worth a read. Much of this is going to fall onto you, so you have your work cut out for you. I do think you can likely turn it around! Even though you've had GSDs before, it sounds like you got one this time who may be more callgenging than most. It happens! You can do this...