Risks depend on the way you have set up your settings. Especially the path and whether you use markdown links. I’ve seen no problems when I tested, but usually I use shortest path and don’t use markdown links. It’s important for all file names to be unique, else there could be a clash when you are in the higher vault. You won’t be able to make or use links with files outside the folder.
I think you can save a bit of time by copying your .obsidian file into the root of the new vault - though prefer to set each vault up individually.
Safest way is to test it first. Copy the folder to a different location. Work in that until you are confident there are no problems. Once happy, copy the folder back; this should bring all the changes with it.
As always a robust backup process is advisable.
There will be no interaction between the vaults.