Beginner's power supply design
With the addition of a simple filter, you have a classic CCM (continuous conduction mode) buck converter:







simulate this circuit &ndash; Schematic created using CircuitLab

So yes, the overall idea is quite viable, and there's tons of literature about this kind of converter all over the Web.

Without the filter, it doesn't work &mdash; you never actually create an average output voltage that you can compare to Vset. You may have been assuming that the load does some sort of filtering implicitly (bypass capacitors?), but that depends heavily on the effective output resistance of M1 and M2, and kills your overall efficiency.