Every reputable company hosting stuff on the cloud backs it up. It's assumed anyone would know that. Not only for protecting the files, but to facilitate upgrades, etc etc etc. I dunno what server farm or third party Adobe uses for hosting, but you can find out more here: http://www.adobe.com/security/resources.html
I read somewhere they are gonna release a downloader application specifically for these cloud files, so you could get them back if you don't have local copies.
The big question is whether you could get the image adjustments back. But that's an issue with any software product where you make changes that you might wanna transfer to another program.
I have read that and they use Amazon S3 as the back end storage for your creative cloud storage farm. That is not a backed up service unless you pay the premium for it. The data is replicated across AWS zones for fault tolerance, but no, it isn't backed up per se. Granted, the risk of a catastrophic failure taking out multiple zones today is negligible but still don't rely on it as safe storage for your photo library. Also in the forums, Adobe support states "No you really shouldn't use this as backup storage."
It is a file sync solution like Dropbox except with services wrapped around it.
Which is fine, but just know its limitations.