welcome...im still "new" at this too.
im not sure how others did theirs. i'm using a cage so i did the following:
1. observe where they pee. put the toilet there.
2. use cloth/tissue and wipe the pee (yes, its disgusting) and put in the toilet. put some poo too. i hang hay above to get it to sit there.
3. when the bedding is soiled (i use bedding) CHANGE.
i change mine every 2-3 days cos mine will pee BESIDE the toilet (into hay bowl!!!

) when it gets too dirty.
they will still poo outside the toilet but will mostly poo & pee in the toilet.
im not sure about expending their play + toilet area. mine is just the hall area and the cage is at the door.
it has free access to cage and hall so it will always go back to the cage (it knows the way back).

Thx for the tips Ally. My rabbits are caged too (I let them run around the garden twice a day) and I have also put a litter tray with beddings (wood shavings), they pee & poo inside the tray and outside as well. However they like to throw out all the wood shavings.They also like to sleep in the tray. I wash the tray daily and put in fresh shavings, frustrated to see them end up in the tray below the cage (used to collect their litter). Maybe I should put those plastic mat on top of the shavings in the litter box to avoid the rabbits throwing them out.