L.A.
definitely free play! Play is their thought process. It allows them to explore, learn, understand and lots of other things.
You didn't ask, but when they fight, allow them to find the resolution instead of stepping in with what should be done. This way they can learn to do it on their own. It takes longer, but really only just a bit more and the lessons learned are really worth it!
How cool that they have such strong imaginations!