If a person had been a contractor for some period of time I agree that is perfectly reasonable.

Myself I have never been a contractor and really do hate side projects of which I have taken a few and found myself tied to them far beyond what I could charge so I quickly got out of that. I did make the mistake of mentioning I have done some web sites in the past directly on my own. That is a job interview killer because employers do not want you to have any other responsibilities other then for the company, so even if you have done a few websites on the side in the past, just don't mention it. It didn't help me to mention that, it was not a positive like I thought it was. If you want to use that experience, say you did it not for someone else but to learn how to do "x" because it seemed interesting (might be modifying some cms, shopping carts, etc whatever) and there can't be any business reason, you just did it for fun and not for anyone else.

Even little things can be a job interview killer. Right out of High School I decided I would get a simple job as a person who takes telephone sales at a company that sells cpu's and memory. It was entry level with entry level pay. I had relatively no experience so I mentioned I had helped few people with there computers (innocently enough, not even as a business, just the 'hey you know computers help me with x' type thing). The 3 women (I have no idea why it required 3 people but...) said that the company was going to go into computer repair and that they couldn't possibly hire me because I would take all of there business. Then they started making jokes at my expense, I have to say I nearly cried. I have never desired to be in the computer repair business myself

I have more stories like that, it gets really bad when you work on your startup for two years and then need to get a job.

I have some simple suggestions if a person is NOT applying at a startup or a web only business:

1. You didn't own the startup, working at the startup was a mistake you would never want to repeat. You were told that there were paying clients and that it was cash flow positive. They lied to you and you don't like being lied to.

Reason: You might leave there employment for some startup opportunity or that you might be a free thinking human being and somehow impervious to instruction. OR even worse you will compete with your new employer, your a mole out to steal there business.

2. You do not have any side projects, you have never taken any side work like a simple website project. You would never think of doing such a thing! If you are married say your wife forbids it, then laugh and talk about how much trouble you would get into!

Reason:
Employers want your full attention, if they think you are going to make any money on the side then heck you might even start doing that work during work hours or there work is going to be less important. None of that is true but people are plain stupid and you cannot afford to "chance" that the person might be a thinking human being.

I have more sage advice but this is already getting a bit long and I am pretty sure most of the people here live in areas where it is ok to have "outside" learning experiences. Not where I live :)