Every thing in the world smell different to a dog. When we train a dog, we associate a particular smell with an action, the alert, which get the dog a reward. The instance of the dog ignoring animal blood was simply the fact that it had not been taught to indicated on those particular scents, no reward, no indication. A disaster dog is taught to ignore cadaver scent and only search for live scent by the simple means of it gets its reward only on alerting on live scent. If the training is good enough it is possible to sometimes get the dog to generalise, Fire investigation dog have been known to alert on a scent that they have not been specifically trained on. They usually have 12 or so target scents in their library and because most accelerants have key components in the scent make up, the dogs recognises the key elements and alerts on them, not on a specific scent. The same applies to UK cadaver dogs. They are trained to alert on the general scent of rotting flesh, because we are not allowed to use anything to do with humans for training. Psuedo scent is the closest you can get to cadaver scent but is very expensive, hence why people use pig flesh, which is very close to human flesh.
The situation in the USA, as I understand it, is different from over here. They use the dog's detection as evidence in criminal cases. Here, the dog is used to assist in the location of evidence, which is then gathered by the Police.