MSSQL database backups are not created on the network location specified in the settings:
The directory is left empty, and the backup is placed in its default location:
The "Temporary network directory" on the above picture is used for keeping temporary(!) files. MSSQL database backup/restore uses this network share not as storage for backups, but as a temporary location to transfer the files between the PP and the remote MSSQL server:
1) When a backup is chosen for restoration and the temporary network directory is set up, the backup is copied to this folder and MSSQL is commanded to restore it. After that, the file on the network share is removed.
2) Backups are done similarly - MSSQL is commanded to backup to a network share, then the file is copied to the local repository and removed from the network share.