Hi dtoddc and welcome to the community!
As long as you are not planning on introducing this server back onto the same network as the production server then I don't see any issue with cloning as you propose. Just make sure they never see each other - not actually as issue for each other but more from the prospect of clients updating the wrong SQL instance.
Clone then move to an "offline" network to complete your testing.
In the past I have also taken our backups (OS and SQL) and restored them to an offline network. This tested not only the upgrade but also my recovery processes at the same time
Kind regards.