The problem is that most apps opt out of backup, so it's effectively useless.
Android 12 changed the meaning of allowBackup="false" to opting out of cloud backups. GrapheneOS encrypted backups use the device-to-device transfer mode which includes apps opted out of cloud backups. It's similar to the Google Play data transfer feature, not Google's backup system.
Yeah I don't even understand why this is even a thing. It should be user's choice, not app vendor/developer's choice.