If my toddler is involved in a fight with another kid, should I intervene right away or let them sort out their issues themselves?

I generally let my kids try and sort it out first among their friends. In most cases, kids fight and make up in some time without any intervention needed. It's quite common for kids to fight one moment and then be friends the next. As long as no one is getting hurt, physically or emotionally, I think it's better to let them try and resolve their issues - a good life lesson too. Of course you may need to intervene if things get out of hand.