Has anyone tried this? Do you usually need to let your employer know and could there be blowback?
You should re-read your employment contract, and any other official company terms and conditions of employment. Some employers do say that you can't have a side hustle, or maybe they just prohibit certain kinds of side hustle. Others say that you just need to inform them if you have one. Others say nothing about side hustles.
You'll probably want to create an LLC for your side hustle. If you get a lawyer to help you set up the LLC, then it wouldn't hurt to ask them about any laws you should be aware of. The cost of a real lawyer's advice could save you a lot of money and trouble in the long run.
If I realize I can indeed start a side-hustle then yes I'd get a lawyer's help to start the LLC.
In California, incorporating with an LLC costs $800/year and provides little to no benefit. It specifically does not provide much legal cover if you're a one-person corp.
On the other hand, it's easy and free to set up a "sole proprietorship" with the IRS, and register some snazzy name at your county registrar. This is the path I took, and I recommend it. (Nolo Press is a good resource for many basic legal things.)