I did a quick research and it seems many people are doing it and there isn't anything wrong ethically or legally, so is there something wrong in subletting for profits that I'm missing?

We would then rent both units out.For Wisconsin landlords, is there any licensure that we would need in order to legally rent out a property we own?

My analysis is similar to what @Dan Heuschele          FYI: I went to The City of Vista meeting two weeks ago and they are considering reducing permit fees on Granny and Second Unit (Granny with Kitchen).   

My plan is to secure the permits for the lot split and the new construction before I approach a builder.

That way, if you don't like your housemate very much, but they're doing everything legally right, you still have a way to end the lease and ask them to vacate without being committed to a one-year lease.The income from this rent might not cancel out your mortgage, but it'll minimize it nicely, helping you to accelerate your savings and paying down any bad debts even faster.

Our best work is usually done by hiring individual handymen and subcontractors to pull specific permits as needed.

., Texas/Utah) if you are permitted to work remotely for a portion of your time to reduce your CA state income tax burden.

I don't know the building code in your market, but whenever I run into smaller MFR's, especially duplexes, that have only 1 meter I wonder if it was converted from an SFR at some point, how well that conversion was done, and if that conversion was legal with the city.

Peter if you go new subdivision pay attention to the size and solvency of the builder.The small builders that do one off homes or small to mid size cluster subdivisions those are the ones that usually can be in big trouble if an economic shift happens.Look at new build permits coming online for the area and the price range you are looking at.The big builders tend to be more experienced and can still finish out  projects with down turn so you do not get left with a pipe farm development where some homes and some empty dirt parcels.Nothing is foolproof but this can help.

My lawyer is paid for through a pre paid legal plan through work and hence I do not have any such costs either.