Quite a few people play this way, and Yes, you do need an account for each instance. Quite a few of us have several accounts for family members, a back-up mule/trader, or for 2 boxing.
(To be pedantic, '2 boxing' usually means playing on 2 PC's simultaneously, whereas playing 2 toons on one PC is often referred to as 'botting') Some people use a product called
EQ Windows which isn't sanctioned by SOE (although there are widespread claims that SOE turn a blind eye to it now) which allows fast switching between instances. Some don't bother with EQ Windows, but often complain that switching between windows is slow.
PC Spec needs to be pretty decent, but works well for quite a few people.
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"I started out with nothin' and I still got most of it left" - Seasick Steve