Sure, you can use 2 interrupts to manage a rotary encoder, but it is a bit of a waste of interrupts. I poll rotary encoders every 1 to 2 milliseconds instead, which also allows me to multiplex them (I've just completed a design that uses 3 rotary encoders multiplexed on to 2 input pins). You can find the code I use at Five things I never use in Arduino projects | David Crocker's Solutions blog.