I have just had my first child, and Charlie for the first time had to give up some lap space.  Here is what I have learned thus far:

Pugs think babies taste pretty good.

If you are squeamish about having a dog lick your child, you may want to teach your pug not to do this.  I do this the same way I did chewing on me.  I say no lick! and then give him something else to do, like play with a toy, then praise like crazy.  This has worked pretty well, and now he only sniffs the baby.  Pugs think babies smell pretty good too.

Pugs like to chew stuffed animals.

Here is something unfortunate that had I the foresight would have changed at the beginning.  Most dog toys are stuffed animals with squeakers inside or brightly colored rubber ones.  Most baby toys are too.  This creates a problem!  My solution so far has been the stuffed baby toys stay in the play yard, and the plastic ones are on the floor.  I also say NO! when the dog gets a baby toy.  He does know what toys are his, now he has to learn what toys will not BECOME his.  It is important not to let the baby toy become a dog toy because he has chewed on it.  Throw it away, otherwise the dog learns that once he licks it he gets to keep it!

Pugs don't mind sharing the lap.

Charlie would not give up the lap completely so I have learned to nurse the baby and allow the dog on my lap at the same time.  In fact the dog makes a nice nursing prop for feeding time.  This has worked quite well.  Charlie also has no problem with probing baby fingers pulling his ears and hair.  Just watch that the baby doesn't put all that dog hair right into it's mouth!