I upgraded to 1.6.2 which always failed, then 1.6.3 which reports an error but seems to work.
I do a manual backup and watch the destination folder. BUWP creates temp files and a zipfile and I can see them 'filling up'. However at the end it deletes all the files it has created, except for the zipfile which seems fine.
The front end reports that the backup file was NOT created, but it has and it seems fine.
Bit worrying ?