Yes that software (link in USA store: http://software.store.creative.com/p/software/sound-blaster-x-fi-mb3). If you already have the Cloud II (and the cloud II only connects via USB?), then yes, Creative's X-Fi software is probably your best bet.
The thing about surround processing (see my article linked in my signature), everyone's ears are slightly different and what works for most people won't work at all for others. Mad, NamelessPFG, and I used to weigh in about which was "best" between Dolby Headphone, Creative CMSS-3D, and Creative SBX; while we could generally agree on certain characteristics about each processing method, we also came to the conclusion that it mostly came down to personal taste. Those three are the most widely used and available processing, but there are many more which vary in sophistication and "naturalness." Razer surround processing is pretty customizable, but ultimately it's just not as sophisticated as the first three I mentioned and (subjectively) I couldn't get it to sound natural to me.
Regarding headphones/headset, I'd prefer something I could use with multiple devices, especially if it was going to be my only or "main" headphone. I haven't heard the Cloud II myself, but I have a CAL! 2, it sounds nice enough with a pleasant warm and bassy sound, but I've never been able to wear any closed headphone so far for the multiple hours I like to play games for. Hot ears and pressure discomfort, the CAL!2's are better than some closed headphones but not especially for marathoning IMO.