It sounds to me like you did counter him, and you did it well. No counter attack is going to be totally 100% successful in poker. Thats the game. Donks, bullies, and fish make big wins or knock you out all the time.
You had the better starting hand, that flop would be scary for me personally. But hey, A-Q is a damn good hand and chances are the big bully isn't playing the greatest cards... and in this case he wasnt, but you wanted to stand up to the bully and you did it. You got balls! And if an ace or queen had hit the board or if he happened to be bluffing with rags think of what would have happened to your chip stack and your table image. This oppurtunity will come again, and you ought to do the same thing when it comes. Its all fun n games in the end anyway.