Q: I see two Windows "drives" when I boot with the Option key

Well, no.   I had a Blue screen of death on my prior windows installation attempt.   Since it was a new install anyway, I chose to get rid of the Windows partition and then create a new partition and start over.  So far this is working, but I have the two icons.  The first Windows icon attempts to boot Windows, but then tells me that my installation needs repair.

The second one works fine.

It is a Mac Mini (Late 2014).  I think the answer to your second question is Yes.  I had a Windows 10 iso image.  I put this on a USB stick using bootcamp and installed (using bootcamp) from that stick.

I don't recall using Alt/Option.  I started from the Mac and told bootcamp to copy the necessary files and then begin the installation.  I do not recall needing to hold the Option key.

I'd really rather not remove and install again if I can avoid that.

/dev/disk0 (internal, physical):

   #:                       TYPE NAME                    SIZE       IDENTIFIER

   0:      GUID_partition_scheme                        *1.0 TB     disk0

   1:                        EFI EFI                     209.7 MB   disk0s1

   2:          Apple_CoreStorage Macintosh HD            866.4 GB   disk0s2

   3:                 Apple_Boot Recovery HD             650.0 MB   disk0s3

   4:       Microsoft Basic Data BOOTCAMP                133.0 GB   disk0s4

/dev/disk1 (internal, virtual):

   #:                       TYPE NAME                    SIZE       IDENTIFIER

   0:                  Apple_HFS Macintosh HD           +866.0 GB   disk1

                                 Logical Volume on disk0s2

                                 58ABF7B9-B6B4-433A-B6DC-40F092F8B90F

                                 Unencrypted

/dev/disk3 (disk image):

   #:                       TYPE NAME                    SIZE       IDENTIFIER

   0:      GUID_partition_scheme                        +1.5 TB     disk3

   1:                        EFI EFI                     209.7 MB   disk3s1

   2:                  Apple_HFS Time Machine Backups    1.5 TB     disk3s2

Yes the TM machine (actually WD MyCloud) is/was connected.  Not sure what a Windows RE is.  I did not have an older version on this mac (prior to the bluescreen'd installation mentioned before), however I did on a previous Mac (couple years ago).  When I got this Mac, I started from a restored time machine image from the prior machine (again, a couple of years ago).

Both images say Windows (similar to the attached image copied from another post).  Only the one on the right (newest) will load successfully.

Neither says EFI Boot.  Both say Windows.  I did not remove the failed installation with Disk utility, (did not know I should have).  I thought that I did not have enough space for the windows installation (originally 80GB).  I used Disk utility to try to resize the Windows Partition, but that did not work.  So I used Disk Utility to remove the Windows Partition, then resize the Apple partition to 100%.  I then used Bootcamp again to create a the current windows partition and install Windows.

To clarify, I don't think I had a "failed installation".  The original was working for a day before the blue screens happened.  I chose to remove the partition and reinstall at that point.