The OEM setup on the 2G Bandits is a three hose. There is a splitter on the lower triple tree. (Remember however, the OEM hoses are rubber, NOT stainless).
I used the standard splitter, and a three hose system for my set-up, with Goodridge SS hoses.
Advantages: - uses stock hose routing, splitter and hangers, etc. This allows everything to fit as it did on the stock bike. I re-used the rubber protector "sleeves" and hanger rubbers from the stock hoses.
Disadvantages - You need more crush washers, have more potential for leaks, meaning more possibility for air leaks. But, once everything is tight, it's tight.
I wanted the stock routing, so I went this way.
A two line set-up needs two longer lines, that connect right to the master cylinder. If you are building a custom, or want to get rid of all the stock bits (splitter, hangers, etc) this tends to make a cleaner set-up.
Advantages - less connections/places to leak. Gets rid of stock splitter. Can make a cleaner looking installation.
Disadvantages - you may need to make up your own hangers, or modify the stock hangers to keep the lines away from any rub points.
Performance should be effectively equal. For full race applications, the two line set-up does hold a little more fluid, so it should heat up a little less. Both set-ups will add additional power under full pressure, due to less line expansion. To add some additional initial "bite", consider a set of after market HH pads as well.
Good luck, let us know how it goes, and what you think.