If you only ever want to ask for that information in one place, then yes, do that.

If you might some day want to ask for that information at different areas of your site, then you might want to take another look at it.

Doing what you want with this module is fairly simple:
1) Enable Referral Sources module.
2) Go to Content Management -> Referral Sources.
3) Click Add.
4) Fill out fields, click Save. Repeat for each referral source you want to track.

Referral source selection at user registration is enabled by default. You don't have to do anything else unless you want to.