Does it hurt a dog to reach into their mouth to pull out something they shouldn't eat?

You did the right thing. I mean, sure, it's not going to feel great to the dog to have you pry his mouth open and take something out. Does it feel good to you when you go to the dentist and he starts poking around? But, it's certainly not inhumane. It's necessary. If the dog ate the chocolate or the pencil, he could get very sick or die. So, you did the right thing.