Can you breed a dog with an umbilical hernia?
The short answer to that question is "no".
This page (http://www.vetvet.org/dog/medical-problems/surgery-diseases/umbilical-hernia-surgery-on-dogs) says that umbilical hernia is not genetic. So, you could have a hernia without having a parent or sibling who had it, and therefore there is nothing you could do to try to prevent or reduce the risk of it. It can also occur during early development, before a dog is even weaned off the nipples of its dam. So, while you could breed a dog who is susceptible to it, you won't be able to eliminate it in the breeding line.
As mentioned elsewhere, the hernia can cause the dog pn and can cause complications in other parts of the body. There is some risk of strangulation if it gets large enough to press on the bladder, but with appropriate treatment it is generally not an emergency. In cases where the hernia gets to the bladder, a hernia reduction should be performed right away. In a lot of cases, this can be done through a laparoscopic procedure, where a surgeon makes a tiny incision in the abdominal wall and can then examine the inside of the belly to find the hernia, and can then take it out, suture up the hole, and close up the incision. Laparoscopic procedures are less invasive than abdominal procedures that are usually done when a hernia becomes a problem. These procedures are generally considered safe in adult dogs, though there are some concerns that it may be harmful to puppies.
The best thing to do if you notice a hernia is to have it checked by a vet as soon as you can so that appropriate action can be taken. This can be an easily overlooked issue if it is not looked at until the problem is big and difficult to manage.
It is important to note that there is one thing you can do to try to help a hernia heal faster. If your dog is not having bowel issues that are caused by the hernia, then you can apply a heating pad or warm compresses to the belly of the dog. This should help to stimulate blood flow, which should help with healing. This is especially true if your dog is overweight and the hernia is not being stretched as much as it could be.
It's certnly possible, I don't know if you can breed a dog that will have a hernia, but you could definitely have a hernia that will be passed down to the next generation (in my family, one of the dogs that we have has a hernia, we had to have it removed because it started getting bigger and we were having other issues), so in theory, you could breed a hernia with all sorts of dogs.
You can not prevent, or in other words "breed out" a hernia, but you can help a dog that suffers from it.
Have the dog evaluated by a veterinarian immediately
Make sure it has not been injured
If it does have a hernia and has not been injured, make sure it is not pnful, and if it is pnful you need to treat it
If the dog does have a hernia, then have it evaluated for surgery by a veterinarian. Depending on the size of the hernia, and other factors, this surgery can be done laparoscopically (very small incisions, so not much discomfort) or through an incision. The laparoscopic route is much preferred if you have the opportunity to do so, but sometimes you just can't do that.
You can read more on the subject here.