I tried it on a relatively fast 28meg cable connection, and it took over 2 hours to download... i guess it depends on whatever ISP and their connection/routing to the Apple servers. -- F**K THE NHL. Go Blue Jays 2013!!!
When everything is working properly, you could use SuperDuper! (or some other cloning program) to copy the contents of the hard drive over to an external drive. If the iMac's hard drive needs replacing in the future, you could then clone the external drive's contents to the replacement.
For the entire OS or just the recovery tools? It downloads and executes the recovery tools first, then if you want to do a full reinstall it downloads the OS or you can do the other stuff like restore from TM. I have a 50Mb connection and it didn't DL the recovery tools and the OS in 30 minutes. It took a long time.