I was wondering If having two campaigns with the same domain but different directory, example:

www.xxxxxx.com/xx1.html

and

www.xxxxxx.com/zz.html

would it be acceptable for Adwords, or would only 1 campaign show its ads if they have some of the same words on their list?

or should I recommend to the client to get a new domain to promote their other product?

You can point ads to more than one page per domain. In fact you really should have different landing pages for each ad you run. What you're asking is acceptable and recommended. Just set up different ad groups within your campaign for each product. Then send the ads to the most appropriate page on the site.

cool thanks