What if the kid with the rock was the aggressor, and the other was wielding the knife in lawful self defense?
Making them both drop what they had and securing them was definitely the right thing to do until the situation could be sorted out, but rolling up on a situation that looks like mutual combat, without really knowing what is going on or who started it, I don't think you should be shooting anybody unless one of them stops fighting and the other keeps going after him with deadly force, or one of them starts posing a threat of death/serious bodily injury to you.
Making them both drop what they had and securing them was definitely the right thing to do until the situation could be sorted out, but rolling up on a situation that looks like mutual combat, without really knowing what is going on or who started it, I don't think you should be shooting anybody unless one of them stops fighting and the other keeps going after him with deadly force, or one of them starts posing a threat of death/serious bodily injury to you.