Is this Typosquatting and Illegal? Or a Possible Small Money Maker?

I'm a noob and have been reading the forum for months. I think I'm ready for my first post!

Earlier today, I was typing in the name of a decently popular website. I left a letter off the name and noticed the domain wasn't taken. I've heard of typosquatting / cybersquatting and read about it but am not really sure about it. With this 'misspelling' the domain name could take on hundreds of other uses so its not just like putting an extra O in Google. The letters could be abbreviations for hundreds of things.

Now, I imagine registering the name wouldn't be an issue if I built a site that had nothing to do with the other site. But my question is, can I make legal money off the name the person wanted to put in there? For instance, can I write a 'review' or something like that of that site and wrap it in adsense and actually make a dollar or two? I noticed the 'misspelling' gets over 50K searches a month and decent advertiser competition.

And if this is higly unethical.. please don't think any less of me! I'm just a noob and I'm not sure if this is common and a small money maker on the side? Or if I will be sharing a cell with Madoff if I attempt this.