Why would you sync the backup? Just backup the contents of your Dropbox folder to a hard drive every night. Then it's on the hard drive and Dropbox can't access it.

So you keep your files and your backups in dropbox?

Rule 1 of backups is "don't keep your files and your backups in the same place". Pretty much common sense.

Incremental backups or deduplicating storage (ZFS)?