When they're two, it does seem that crying-it-out simply doesn't work, doesn't it!??
Our daughter was 2.5 when her baby sister was born, and we experienced total regression. She did not want to sleep in her room anymore and some nights it was easier to just let her climb in bed with us and all get some sleep! We did realize though, that none of us were getting quality sleep (the newborn was sleeping better than all of us!), so we had to stop, cold turkey!
We started a new nighttime routine, and I would stay with her in her room after books and lights out until she was drowsy enough that I could say something like, "Okay, Mama's gotta go take care of the kitties now--how many minutes do you want me to wait before I come back to check on you?" This served two purposes, 1) preparing her for me to leave and 2) letting her feel in control enough that she got to "tell me" when I could check back on her. Most nights, I'd just peek in after 15/20 minutes and she'd be sound asleep.
If she came in our room in the middle of the night, we told her she'd have to make herself a "nest" on the floor and sleep in it. It was so cute, the first time she walked back and forth getting her blanket, pillow, stuffed animals, etc., making her nest and finally sleeping (at 3am!. The next night, she dragged blanket and snuck a pillow off my bed. The third night, she dragged blanket, rolled it into a ball and used that as the pillow (i took pity and covered her that time) and by the fourth night or so, she stayed in her bed.
A lot of it is about control and comfort. We finally got our girl a twin sized bed and she loves it. The toddler bed was kind of small now that I think about it!
Hope you are able to figure out something that works for you all.