(On Win7 Ultimate x64 SP1)
So I've been using Win7 backup to \192.168.0.100\Backup\main-desktop\ for awhile without issue.

Yesterday I tried to setup crashplan to synchronize my dropbox folder and a network share. I then found out that crashplan, as it runs under the system account, can't see my user mapped drives. So I created a startup script
net use O: \192.168.0.100\Documents /USER:192.168.0.100\username password

and set it to run, on startup, after the network interface is up, as the system account. (the username & password are the same for the net use script above, the locally logged in user, and the explicit username/password entered in windows backup).

I woke up this morning to find error flags from the windows backup and get "Network location cannot be used" (0x800704B3).

If I disable the startup task & reboot then windows backup works fine.

I'm not sure why having a mapped drive for another user is killing windows backup (same server, different folder). I can work around the issue by using another program to synchronize the two folders, but I'm completely in the dark as to why this happens (and it's 100% repeatable). Uninstalling the crashplan client doesn't change anything - it's the net use run under the system account that breaks win7 backup (to a network location).