All plans include hosting on Cloudways' Vultr servers.
Depending on your site's needs higher storage and performance packages are available, contact me for details
Of course you can host your site anywhere you like but server performance can not be guaranteed if you do.
For anything other than a brochure site I would strongly discourage using shared hosting.
Backups are kept on a server of your choice. It could be Dropbox, Google Drive, any where you want really. All of Cloudways' plans include daily backups for added peace of mind.
Backups are made daily on a 7 day cycle. This can be modified as needed.