As advertised, it seems that the Dust Deputy is designed to extract dust from the air stream before being sucked into the filters of a shop vac while the Grizzly Dust collector is designed to collect most of the dust in the collection bag. Using a dust separator to extract dust may only be desirable to catch larger pieces of wood that could get caught in the collector fan.
I have a 2HP grizzly dust collector using 4" pvc pipe (40'of pipe) with three gates and 10' of flexible 4" hose to make final connections to freestanding equipment. I intercept large bits of wood in a metal trash can with a inexpensive cyclone type top. The system is pretty closed although there is some leakage at the trash can interceptor. If I keep all other gates closed, I get plenty of air flow back to the collector, enough to lift small pieces of wood such as a short pencil (don't ask how I know) up 7' vertically and across the balance of the system. Whether you should get a 1 1/2 HP or a slightly larger unit depends upon your budget and how large (length of pipe and number of ports) the distribution system is. I believe that a 1 1/2 HP unit should be adequate, but if you have the cash then I know that 2HP can work.