Ugh it can be really triggering to witness things like that aye. There is a family in my street that has a lot of domestic violence happening and the police are often called. It triggers up so much stuff for us, every time we hear the voices start to raise we go straight into trauma mode. Brings back so many bad memories.
I think in this case you will probably be okay, normally police don't ask for witnesses when a victim doesn't want to go ahead and press charges because its too hard to prosecute a DV case when the victim won't cooperate. In all the times we have seen people arrested from our neighbors home police have only once talked to us. and that was because the call to police came from us (one of the woman had sneaked out of the house and asked us to call them for her).

That was a really awful thing for you to witness though and its understandable that your littles upset. Can your adults talk to them and explain what happened?