[dnanian]

No, it doesn't need to be launched, but you do have to be logged in, in front (if using Fast User Switching) and the screen can't be locked.

SD itself won't wake the Mac, but if you take a look in the User's Guide under scheduling, it explains what to do. (You can find the User's Guide, which has lots of useful information, in Help > User's Guide.)

Hope that helps!