In most places I look at to investigate the use of OneDrive, I see that it is excellent for backing up the contents of the Documents and Pictures folders. ...
I'll say this: Any kind of backup is better than no backup. However, as a backup destination for your personal files, OneDrive has many weaknesses. In no particular order:
1- There's no versioning: You can't backup Monday's version of a file, followed by Tuesday's version, followed by Wednesday's version, etc. because Wednesday's version will overwrite Monday's and Tuesday's version.
2- It's slow: Uploading your personal files to OneDrive takes much longer than backing up locally, as to an external hard drive. And Microsoft has the right to throttle your uploads to balance the load on its servers. And all that uploading uses a significant amount of your available bandwidth.
3- No verification: You can't verify whether the files you uploaded have been uploaded completely or whether they have become corrupted.
4- You can't do incremental or differential backups, which make backing up so much faster.
5- It's risky: If you lose access to your Microsoft account - you're hacked, can't find your BitLocker recovery key, forget your password, etc. - you have lost your backups
6- It's expensive: If you're backing up every day - as we all should - it won't take long before your backups use up a significant amount of your 1 TB allowance (if you're paying for a Microsoft 365 subscription) so you may find yourself needing more space. And much of that space will be occupied by files you rarely access.
7- Limited ability to recover deleted files: When you delete a file from your OneDrive it will be sent to OneDrive's trash bin - but it will soon be deleted permanently.
8- Questionable privacy: Not everyone is comfortable with storing their sensitive, personal information on Microsoft's servers.
As I wrote at the outset: Any kind of backup is better than no backup. But if you're serious about backing up - which I'm presuming you are, otherwise you wouldn't be asking - then nothing beats a real backup application from a commercial developer. These applications make backing up your personal folders (or your entire computer, if you want to do that) quick and easy.
External hard drive are a much better destination for your backups. They're fast, inexpensive, private and easily portable. They make it easy to store backups in different destinations (one of the hallmarks of a solid backup procedure.) When used with a backup application, they provide the ultimate in security for your computer.
[Note: You can only backup and restore your personal folders: Desktop, Documents, Downloads, Music, Pictures and Videos. The other folders in your user profile cannot be restored by downloading them from another source, like OneDrive.]
Like many of the free applications included in Windows, backing up with the OneDrive app is best suited for people with simple needs who may be uncomfortable with (or simply opposed to) going outside of what comes with Windows. If that's you, stick with with what OneDrive gives you. But you can do much better, My life is on my computer, so I don't want to have to live with the OneDrive app's limitations.