You only need one monitor.
However, for pc recording, you almost always need two hard drives.
1 for reading the game you are playing, the other one to write the recording to.
Otherwise the hard drive cant read the game AND record the game to the same hard drive quick enough, it results in lag and after a while drops to 0fps and freezes until you close the game down, usually with the task manager
This is what happened to me anyway. After I set the record location to my other hard drive however, everything was fine.
Also, having a separate partition to your hdd doesnt work. The HDD need to be able to physically spin/move fast enough to record and write at the same time.