In a small space there may not be a place for a separate play room. But that doesn't mean a play area all their own isn't possible. Try creating a play nook, a corner or part of a room that holds toys, books, and art supplies.
Great idea RE the twin mattresses. I also love the tree pictures on the wall! Love to display kid-made art in a kids room! Two twin mattresses, some plywood, and a great playroom that doubles as a guest room or sleepover room.