And I'm not one usually in favor of outsourcing, but having employees is a whole different ballgame. If you can't let them fail, you're not building a team that will add value over outsourcing, so you're better off not taking on all of the complications that come with having employees.
Are there any good books/blogs on the subject matter that anyone knows about?
EDIT: Just to make it clear: obviously employees and everyone else are going to fail sometimes, and you need to try have as much in place to survive that. However, failing on purpose for learning experiences is never the correct approach. You will have more than enough chance to fail in areas you don't have solutions for. Make sure you never fail in an area that you had the information to prevent.