I free range. I let my kids be outside with an older sibling at, um, ready? 15 months. It's only for a minute, while I go pee or something, but my oldest is only 6 :-) my second is 4. When my second was 21 months, I started letting him and his 3.5 year old sister play outside for longer periods of time with me watching from the window. I fenced in my yard, and I can see things from the kitchen or dinning room window. But, I have a giant playground in the backyard, with a giant tube slide. My son went down it with no problem at 19 months -he is very physically capable. By 21, I felt comfortable letting him do it without me close. When I know the 15 month old is no where near the playground, I go inside to pee, move laundry, etc. The oldest knows to spot her if she decides to go towards the little slide. I try to not let that happen, but a few times I have found the little one on the ladder with her sister behind her.
My oldest broke her arm the other day. She was with her dad. My toddler fell down the stairs, I was right there and I couldn't catch her. I hate that!
If something bad is going to happen, it's going to happen.
I'd feel very comfortable leaving a two year old with a five year old in a fenced in yard. My kids know to watch out for each other and to get me if someone is doing something they shouldn't be doing. I'd have no problem at all with a 3 year old being alone. My oldest played outside all the time by herself at 3. She loves being outside, and I had a baby. So baby and I stayed in, and she played out. When my little one is 18-19 months, and if capable, I will have no problem preparing dinner with her outside with her siblings, with me watching on.
I have no idea why kids playing outside would be negligence.