First off, the dogs were in your neighbour's garden, so the garden isn't
Second, you say that the 'bad thing' was you couldn't 'punish' Molly, as it was too late. Who's fault was it that Molly was unsupervised?
Third, yes I do believe your choices are wrong and I'm not the only one - take a look here:
Fourth, I'm sure your dogs KNOW when to back off - I think I'd back off too, if I was going to get an electric shock (no matter how mild).
The RSPCA has campaigned successfully here to get the Police to stop using these horrible devices - ask yourself, if they're too cruel to use on a fully-grown German Shepherd, what the hell risk are you running using them on an immature puppy?
Let's just hope your vet is good at treating burns.
For goodness sake, go to the hardware store and get that garden properly secured - I'm more interested in the welfare of your puppy than arguing the toss.
I really wish you'd bin those collars.