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You may have gotten some defective spore. I would contact the company that you bought them from and ask for a replacement.

This article will help: https://www.gardeningknowhow.com/lawn-care/lgen/eliminate-mushrooms-in-your-lawn.htm

This article should help: https://www.gardeningknowhow.com/lawn-care/lgen/eliminate-mushrooms-in-your-lawn.htm

It applies to the garden as well.

It generally means the soil is moist, conditions favorable to fungal growth. You will want to have your soil's pH checked as well. It is probably low and this is why the mushrooms are growing.

It sounds like it has a fungus, just not the kind you are looking for. You may want to have a fan blow gently on the area. This will help keep unwanted fungus from growing on the surface of the compost.

Rather than misting, you may want to try dribbling. Just dribble a little water on the compost rather than misting. That way the water will penetrate a little deeper into the compost itself, rather than sitting just on the surface, which creates the right conditions for that fluffy fungus that is growing.

Yes, certain wild mushrooms are toxic to dogs. Do not let your dog eat any wild mushroom, as there is no treatment for the most lethal. If your dog has eaten mushrooms, collect a sample and take it and your dog to the vet. Symptoms of mushroom poisoning can range from mild vomiting and diarrhea to severe digestive problems to complete liver failure.

Here is an article for ridding the lawn of mushrooms: https://www.gardeningknowhow.com/lawn-care/lgen/eliminate-mushrooms-in-your-lawn.htm