When he's engaged in free play, who is playing with him? Is he by himself? Or is it just him and the younger sibling?
Free play is incredibly valuable in human development. One of its many benefits is that it's where kids learn social boundaries. They experiment with rule-making and rule-breaking. There are consequences involved, because if the play isn't rewarding to all players, the game ends. Your DS does need someone who can hold him accountable, though, and a younger sibling would have trouble with that. So that's where you'd need to find some peers for him to play with, and/or step into that role yourself.
One trap you'll want to avoid is over-structuring as a way to avoid the problem. Sometimes kids act out as a result of spending too much time in structured activities. It's quite stressful to conform all the time... another benefit of free play is that it functions as a safety valve to let off that pressure. As such, my DW and I act as guardians of our DD's play time, and start taking action anytime her structured day is getting excessive.
Beyond that, I don't have any wisdom to offer that you haven't heard before, as all I can do is recommend the same tried and true methods for dealing with misbehavior you've heard before.
For more information on free play and its MANY benefits:
http://pediatrics.aappublications.org/content/119/1/182.full
