You can use one pump, just make it a two tiered setup. I use gravity to drain the hot water out of the HLT but use the pump to recirculate the wort through the coil. You set it up so that both the boil kettle and mash tun can get pumped through the HERMS coil (use a diverter valve to select the source) and just put a diverter valve on the outlet so you have the choice of sending the outflow back into the mashtun (for recirculating) or into the boil kettle (for lautering or chilling). I use the HERMS coil as a sort of reverse immersion chiller by filling the HLT with ice water and pumping the wort through the HERMS coil. You need to put a lot of thought into the plumbing. While two pumps is great, I'm happy with a single pump setup, it makes for less to clean.
As to the contactor, I used it (two actually). It's a sort of safety device. You switch it on and off using a low current controlled by a switch. It, in turn, turns on and off the dangerous amount of current flowing to the element. By using a contactor you don't have huge amounts of electricity flowing through the switch you'll be touching and this is just another layer of safety protection between you and the electricity.
As an alternative, you can just get a switch rated for the sort of wattage you'll be sending to the element. These aren't that cheap so you don't save a whole lot by going that route and it's a bit less safe. Actually, though, I suppose you could just do away with a switch for the element entirely and use the pid to control the element. I'd definitely have an e-stop with this setup though so that you have a way to shut the system down in a hurry.
I may get some flack for this but I don't have an e-stop on my setup. My spa panel is literally right next to the rig and I would (but never have) use the breaker to disable everything if a brew session went south.