Yeah, you're doing it wrong, or thinking about it wrong.
Splitting the ports from switch0 will allow them to act as independent physical LANs, rather than as a switch all attached to the same LAN.
Honestly, if you're looking to create multiple physical LANs with dumb/ unmanaged switches, the ER-8 would've been a better choice (as all of its ports are individually routed, rather than the hybrid switch-able / route-able that the ER-5 uses). There's nothing wrong with using the ER-5 like this, just realize that the ports eth2,3,4 all share a single uplink to the routing engine (rahter than individually being gbit routable).
Also, if you really meant that you're trying to carry (tagged) VLANs on the ports, using unmanaged switches is a bad idea.