I want to use my wifi printer with my Macbook and it works great when the printer connects to the wifi network created when I set up internet sharing. What I want to know is, is there a way to set up the Macbook as a wifi hotspot but without requiring an internet connection?
Yes, you just set up Internet Sharing the same as if you had an Internet connection on one of your non-Wi-Fi interfaces. You don't actually have to have a working Internet connection on the interface you use as the "From" (that's "From" as in, "Share your connection from:") interface. You just need to pick a non-Wi-Fi interface as the "From" interface so you can use your Wi-Fi interface as the "To" (that's "To" as in "To computers using:") interface.
Just like when you've used Internet sharing before, this will put your Wi-Fi interface into "Access Point" mode and start publishing whatever network name you tell it to publish. It'll also start up a DHCP server process to assign private IP addresses to any devices that join the Wi-Fi network it's creating.
The devices that join the Wi-Fi network won't be able to get to the Internet unless you bring up an Internet connection on whatever interface you used as your "From" interface.