Yes, if you have two databases you will need two connection strings.
Your data access code (in any of the four data access models: http://www.lhotka.net/cslanet/faq/DataFaq.ashx) will then open connections to both databases as necessary to get and update the data in your object model.
If you need transactional protection, you must use EnterpriseServices transactions, and that will use the DTC. If you have two databases, you must use distributed 2-phase transactions.