A family of Microsoft products that enable users to capture, organize, and reuse notes electronically.
When creating a notebook in OneNote 2016 (MS Office version only) you have the choice of storing it on a Microsoft cloud service (OneDrive or OneDrive for Business) OR on your local drive. Only the latter uses the setting for the default storage location but would prevent you from accessing your notes with other devices (other PCs, mobile OneNote apps..). As usually the cloud storage is offered as default when creating a new notebook, your data will most likely be there.
If you check your OneDrive (or OneDrive for Business) folder, it is perfectly ok, that you won't see any data files there (they are hidden on the cloud space only), but just a small link file with the name of the notebook.
What you found in the backup folder ist exactly that: A backup. This is created also for notes that are stored in the cloud and does not contain the actual data you are seeing in OneNote but a copy that you could play back in case of "emergency".
So in short: the save default location will only contain any data if you chose to locally create a notebook instead of using OneDrive.
The backup location does contain local backup copies of any notebooks (local ones as well as for those in the cloud) but is not a working directory. The data is in the state of the last backup. You can set up the number of backups and the backup frequency in the same settings windoew where you found the storage location defaults.