1. Do recruits have to be face up to be deferred.
Yes. You cannot defer or discard an animal in your pen unless they are face-up.
2. If a legend or a second leader plays on top of a leader, the rules says defer or trash. Does that mean you lose one of the action for phase 2 of your turn? (Incidentally, this is like spending an action point out of phase)
Right again. If you discard the legend, then it doesn't cost you an action, but if you defer the legend and put him/her back into your deck then it will cost an action.
Hope that helps. Post any other questions and enjoy the game!