I've not folded mine down in a while, as since we got the Citroen C5 Tourer for my wife a couple of years ago, the freelander has been usurped as our "load lugger". The Citroen has a longer boot than the freelander without folding the Citroens seats down, and with its seats up the Citroen has about the same length of boot floor as the freelander does with the freelanders seats folded, but the Citroen has even more floor space when the Citroens seats folded, but the Citroen is a 5.1 metres long vehicle.
So, its been a while since I've had the seats folded down, but as far as I remember, the seats fold flat with the headrests fitted, and by flat I mean the leather for the seatback is in contact with the leather on the seat cushion, but the backs of the seats are still at a slight upwards incline. Then the seat bases fold forwards putting the underside of the seat bases in the vertical position and the seats folded up/forwards go into the back footwell. With the seats forward you might need to move the front seats forward a smidgeon. I genuinely cannae mind if you have to take the headrests out or not, but I'm inclined to say you don't? But try it, slide the front seats forwards, open the boot, operate the black pull handle on the back of the seats, fold the seat back into the base, then the base folds forwards again into the footwell, you'd know in about 30 seconds if the headrests are going to stop the seat folding forward, and it would take you less time to fold the seats than it has taken me to type this message.