K.K.
Both of my kids were swaddled until around 6-7 months of age. It definitely engages their calming reflex so we did it as long as they needed. See Dr. Harvey Karp's "Happiest Baby On the Block" dvd on Amazon for more info.
When it seemed too warm or when the girls were too big, we swaddled them, but to where their legs were free and the swaddle went between their legs and around their arms. That seemed to work well. If they did get cold, we just draped a blanket over their legs.
Also, I am a twin, and I believe my twin and I shared a crib for quite a while...we wanted to be near each other. Just a thought.