My kids are 6.5 and 3.5 and there is still a lot of time spent like what you describe. However, the older they've gotten the better they've become at playing together (and independent from me).
I think most younger kids usually prefer playing near to their adults (parents, babysitter, etc). If the playroom is situated in such a way that they can't see you, or are quite separated from you, then I don't think it's unusual that they don't want to play there. Is it possible to set them up to play in a space near to you while you go about doing your work (doing crafts at the kitchen table while you prepare dinner, playing in the living room while you while you fold laundry or that kind of thing)?
Sometimes I have success setting them up with a game and then sneaking away. For ex. my kids love to pretend that they're puppies or kitties, so sometimes I'll bring out the play tent to be their "puppy house" and suggest that they set up beds in there, and maybe put the box of play food nearby to give them the idea to make "puppy snacks", etc. If I'm lucky that might lead to a good hour or two of independent pretend play!
I do think that if your 2yo has been hitting a lot recently then it is up to you to keep a close eye on him/them until he's passed through this phase. I also think that 2.5 and 5 are kind of "tricky" ages, and you might find that just half a year of maturity will do wonders in terms of them being developmentally ready to play more independently from you.
ETA something else that can help with the whining and fighting is to make sure you're on top of keeping everyone well-fed and well-rested. In our house it's usually the times when one or other is starting to get hungry, or when someone needs a nap or down-time that the behaviour deteriorates.