(reminder that Android makes it trivial to not show notifications on the lock screen, or even in the top bar. I see notifications only when I want to.)
I made something similar with a blink USB light: https://blink1.thingm.com/ . I had a little sign that said "when it's red, I'm busy". And a keyboard shortcut to toggle it from red to green (it just ran a little bash script that invoked the blink CLI). It was duct-taped to my monitor so you could see it from far away.
It worked very well to prevent interruptions from other people walking up to my desk and chatting with me.
I never got to the point of having a USB light as a semaphore or anything like that, but I really wanted to find and hack a toy traffic light that would indicate if it was a good time to interrupt me or not. So yeah, it was a very real problem.