3 year old sleep problems getting worse and pulling my hair out (well he is!!)

[Kismet9]

Please help mumsnetters!
I don't know how best to handle this.
My three year old has never been a good sleeper. As it stands, he comes in our bed during the night and wakes early in the morning (before 6). This morning he was awake from around 5 playing with a small torch whilst in our bed, which woke my 5 month old sleeping in the cot next to us. My partner had already retired to the spare room!
Because he gets up so early, he is knackered by lunchtime and I do make him nap as otherwise he becomes very tired and hard work.
When it comes to bedtime he takes ages to get to sleep and I have to sit with him for around an hour whilst he messes about and soothes himself by playing with my hair - this is another issue as I have very fine hair and I can feel him pulling it out.
I feel like I have lost leverage to make him sleep as we removed the door gate as he was climbing over it. The only other option I have is to shut his door (he can't get out) but this feels cruel. He is a very lively, caring, intelligent but strong willed and emotional little boy. I don't think leaving him to cry it out is an option I could stand - it would be quite traumatic.
I have just ordered a CD player so he can listen to stories in bed which might help, but any other ideas please?
I am sick of feeling and looking like sh1t - bags under my eyes and terrible hair! Also, I am starting to quite irritable with him and am now feeling guilty.
This is also combined with 5 month old waking a couple of times a night, which is normal.
Thanks in advance!

[waitingforsomething]

At 3 he should be able to understand that playing with a torch at 5am and waking everyone up is not acceptable.

Can you employ a reward/sticker chart with a groclock to encourage him to stay in his own bed until 6am. If he wakes up before the sun then he can play in his room but he cannot wake you or your baby up.