Correct 2 is what I am using.
Correct --> You need to be booted from the source or the Replicator result may not work.
Long time ago I phased out all my HDD's and replaced them with NVMe's and SSDs. For the creation of bootable backups with CCC I use one of the phased out 2 TB HDDs APFS formatted with each macOS ie. Big Sur, Monterey, Ventura and Sonoma being a volume group of the 2 TB APFS HDD. When I need to restore or revert to an earlier incarnation of one of the macOSes the process is just reversed. It works like a dream and has never failed me, it certainly beats Time Machine hands down.
I maintain backups like this for four machines (hacks) with each one having a dedicated 2 TB HDD for live OS backup
purposes, in other words I maintain 16 macOSes in this manner. Before I upgrade any macOS I always ensure to generate a working backup onto the HDD in order that I can revert should the need arise, which happens every now and then.