The setting backup changes Pyxplot’s behaviour when it detects that a file which it is about to write is going to overwrite an existing file. Whereas by default the existing file would be overwritten by the new one, when the setting backup is turned on, it is renamed, placing a tilde at the end of its filename. For example, suppose that a plot were to be written with filename out.ps, but such a file already existed. With the backup setting turned on the existing file would be renamed out.ps to save it from being overwritten.
The setting is turned off using the set nobackup command.