So I'm hearing great things about 2 but I'm wondering if it necessary for me to first play game one. Is this game I direct continuation or is it more stand alone?

On the GOG store page there is that short synopsis of what bouts 2 is about. It indicates to me that bouts 2 is a continuation of bouts 1 and bouts cc is just an add-on or DLC to bouts 1. Sounds like bouts 1 is where this adventure series starts.

The four playable characters were already on an adventure before (which is explained in short at the beginning of this game). So of course you have more fun after playing the first first :D In my opinion the best adventure game I can remember (yes, even Monkey Island).

Yes, you NEED to play it. Not because a sequel came out, but because it's THAT good. :)

Most of the characters from the first episode return.
There is Jorge the merchant, MARY the ship, Nate, Wilbur, Ivo, Critter, Sloth and Cromp, Remi... I could go on.

The form of humour is the same to the first part. There is an amazing twist in the first part, I haven't finished part 2 yet.

Critters Chronicle tells you a little about, well... Critter and how he got to meet Nate.