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Now, start downloading, Steam should be able to rediscover existing files.
It won't download all the game data again unless you are doing something wrong.
Copy the common folder and place it in some other drive. After fresh windows and Steam install, close Steam and copy the old common folder over the new one. Then restart Steam.
Then Install each game. When you press install it will scan for old files and resume from there. If there is no new data it won't download anything and you will be ready to play.
Another way is to do what I do. I have whole drive dedicated to Steam. I have 3 different windows drives that have Steam games folder directed to that Steam drive from which they load Steam games from without ever having to install or move anything.
So you can make a steam games folder for installing games in location outside Steam drive. This way whenever you have to reinstall windows or something you can just redirect Steam game folder to that location and its good to go.
The Backup & Restore process is very inefficient. It take double the space (even if temporarily) and it takes a lot of time. You have to spend time backing it up and then restoring it.
Maybe its not an issue for people with few games but for someone like me thats hell lot of work and usually I don't even have that much space even on temporarily basis. I hardly have space for storing the data once.
Note that you also have to save the documents folder for some games where they save your personnel data. Most games now have cloud support but some data is still isn't on cloud like screen shots that you haven't uploaded.
Local screenshots you've not uploaded are located in
If I remember correctly I used to do that but some games would get corrupt and would have to start all over again. Don't know if things have changed.