Hoobley, LOL at the jaggy needles in the middle of the night.

I co-slept with DD full time until she was 6 months (in a sling during the day, until around 3 months) and crawled out of my bed giving herself a black eye. I felt soooo guilty. Bought a cot the same day.
For the next 6 months she slept in her bed until around midnight, then came in for a feed and slept with us til 8 or 9am. She also took her day sleeps in her cot. At around 9 months she started waking more and mor frequently so I decided to move the cot into her own room and settle her without a feed most times. She then slept in her cot until around 5 am (with a midnight snack) after which she came in with us until around 7:30am. We still do this just that she now has her snack some time between 12am and 3am and some nights she doesn't wake up at all, sleeping through from 7pm-6am, the sleeping with us until 7am. I loooove those nights.

I don't think there is a problem with co-sleeping, as long as it is working for you. I only tend to address a problem when it is just that: a problem. If it's just about other people not approving, they can kiss my behind.

You could try a single bed next to yours to get some extra space for your wriggly toddler. Or a mattress on the floor. Or why don't you put a mattress on the floor in his room, then lay down with him for a few days so he gets used to it. Maybe he doesn't mind it if he's not in baby jail??? It took DD a while to get used to her cot. She still doesn't like being in it when she's awake. But these days, if she's tired, she can go to sleep in it on her own. That doesn't mean that she'll always play along, though ;-)

Saša