HTC Desire : How Can You Backup Froyo Phone - Setting Completely Hidden?

I am concerned that were something to happen to my phone, an HTC Desire, during updates and app installs for instance, that I would lose everything. So my simple question is, how can you back up a froyo HTC Desire phone?

I am aware that the Privacy -> Backup option has mysteriously disappeared from the Settings menu, and that in order to see it, you need to do the following:

Menu -> Settings -> Search -> Searchable Items ->

- Web (untick)
- Settings (tick)

Now, you need to click the Search button and search for Privacy. You should then see the Privacy- HTC global search item.

Select this and Backup and Restore appears, with the following options:
- Back up my settings
- Automatic restore

Some questions I have relating to this missing feature are:

- Why is this setting completely hidden? Are we not supposed to use it?

- Does it actually work? Has anyone successfully used it?

- When you select to Back up my settings nothing appears to happen. The phone does not appear to start syncing, so how do you know if anything has been backed up? How long should you wait after selecting the option before knowing that you have a backup available?

- Where is the data stored? Can you verify it?

I find it rather strange that I cannot find the answers to these questions in the public domain, so I am asking them here, in case anyone has any insights into it all.

Ignoring the above "missing" option, are there any other ways to successfully back up my phone using 3rd party apps? Which ones work with froyo?