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Good thing is they likely will as it uses the same system as retail games, the bad news is if they do decide to not care retail discs will become useless too. Yay for Steam trying their hardest to ruin themselves to the level of the competition.
You'd like to use > 100 CDs for ONE GAME? And keep an external CD-RW drive around to burn all those? We wouldn't.
Backup - Delete content - delete the game installation and save folder - Restore. +Game config and saves folders. Ideal for moddable games like Elder scrolls, Fallouts, etc.
I personally stopped using it for backup before 2013 when it was a standalone .exe application (too many restrictions and problems - with backup to external media, this feature has always had many problems)
Because backups are made to be preserved in a safe place. You should always backup on multiple DVD and not on HDD or SSD.
Also not every game on Steam is bloated. There are a lot of games that fits on a CD or a DVD.