Preheat your oven to 350F (175C). Grease two 9-inch round cake pans, dust them with flour, then line the bottoms with parchment paper circles.
Add granulated sugar to a large mixing bowl. Add all the lemon zest and rub into the sugar with your fingertips for about one full minute, until the sugar becomes slightly damp, clumped, and fragrant.
Add the softened butter to the lemon sugar. Beat on medium-high for 4 to 5 minutes until pale, fluffy, and mousse-like. Add oil and beat 1 more minute. Add eggs one at a time, beating after each. Mix in lemon juice and vanilla.
Add sour cream and mix on low until just combined and the batter becomes noticeably thicker and smoother. Do not overmix.
Whisk flour, baking powder, baking soda, and salt in a separate bowl. Add to batter in three additions on low speed. Stop the moment no white streaks remain. The batter should look thick, smooth, and scoopable.
Toss blueberries with 1 tbsp flour. Fold into batter by hand with a rubber spatula. Divide batter evenly between the two prepared pans.
Bake 32 to 38 minutes until a toothpick inserted in center comes out clean. Cool in pans 15 minutes, then on a wire rack completely. Beat cream cheese and butter until smooth. Add powdered sugar one cup at a time, then lemon juice, lemon zest, vanilla, and salt. Beat until fluffy. Apply crumb coat, refrigerate 15 min, then frost fully. Top with fresh blueberries and lemon slices.