I too, am also just starting my business. I rent the church kitchen, paid for the license, took the food safety courses and paid for insurance. If you cannot operate inside the law, perhaps you are not ready to be selling cakes to John Q. Public yet.
I don't have a problem with the home baker that makes cakes for their friends and family, but I do have a problem with the home baker that sells to the public without forking over the loot and towing the line that I do. I don't mind losing a gig to someone who makes a better tasting, prettier cake than mine. But, if that person didn't have a license??? THAT would irritate me! Besides, in my state, it's the law that anyone selling food has to be licensed and operate out of a licensed kitchen.
Besides, it's much safer to you, as a commercial cake artist, to cover your bases. What if you underestimate how much cake you need and the bride sues you for ruining her wedding? What if someone gets sick from eating your cake? I know I certainly don't have the money to even be represented in a court of law, let alone have to pay any damages!
I am not trying to be snotty by any means, please don't take it that way.