Recently I have read much about burying new tomatoes deeply. I tend to compromise. I put the tomatoes a bit deeper that the started pot was planted. But, I do not over-do it to the point of burying a bunch of branches. Keep in mind....tomatoes have a lot of issues with moisture/fungus.

They are still awfully small at 2-3" so they would normally go into a 4-5" pot at this stage to grow more before transplanting them into a much larger container. Normal transplant size is 6-8" as but then it will have developed enough roots to survive in a big container. It can be quite difficult to keep such a small plant from drowning in a big container simply because they hold so much moisture.

When I transplant I bury all the bare stem part up to just 1/2" or so below the cotyledons.

Dave

In my opinion, you should separate them. Then you can either plant in their final destination(garden or pot) or plant them in a 4" pot and later on do the final transplant. The smaller the seedling, the less shock from transplanting. But transplanting individual seedling from a 4" pot to permanent location will not disturb it. All you would do then is to water it , wait a while, take it out of pot(by inverting and slight tapping on the bottom and putting in the prepared hole(garden or planter) .I would not touch the roots, although tomatoes are tolerant.

I agree with seysonn...that's what I did this season. My plants are in the garden and look good (except for the unending rain, which I hope does not cause too many problems...got the fungicide ready).