I can't verify it, but i assume it does not touch your primary HDD unless there is caching involved.

Open Taskmanager, go to the Performance tab and click the "Resources" button. There you check the Disk area. Close all programs and windows updates. Anything that does disk access for now. Then start downloading a game from steam. Sort by the "write" column.

If there is caching involved I assume the same amount of data is written to C: then D:

Watch and learn. And come back and tell us :P

Before January 19th 2017, there was no built in method to move games between libraries

Here is what I did though:

1. Browsed to the steamapps folder that the game is currently installed into
2. Copied the game folder for the game I wanted to move into the other Steam library (it's important you copy it; don't move it)
3. Deleted the game within Steam (delete local content)
4. Reinstalled the game, selecting the other game library

This finished "downloading" to the new location instantly, since the files were already present in the new location.

Important note on the folder structure of the destination library

It is important to note that as of trying this process on 2/11/2016 you cannot simply paste the folder into the destination "steamapps" folder but instead to a "common" folder within the "steamapps" folder.

For example if you created a Steam Content Library at "D:\Games\Steam" you will want to paste your game folder into "D:\Games\Steam\steamapps\common" resulting in something like "D:\Games\Steam\steamapps\common\Grand Theft Auto V"