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If you're using some sort of Unix-based setup, then it's really easy: Just start a new X session per display.
Assuming you're on windows, short answer is "yes". How it'll react depends largely on your drivers and how you set options up, though.
Most of the time, dual monitor setups involve the desktop spanning both monitors, in which case your mouse will travel one to the next and windows may overlap both displays. Some drivers allow you to specify that you don't want display overlap, and will allow "window affinity" so that particular programs will always show up on specific displays, along with their dialogues etc. A common option is to set a particular display as your 'full screen video' output.
I personally don't have a problem with windows spanning on my setup, but whatever works for you... but you should be able to get what you want from it.
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