When you configure backup in OneCare, you select the *what* for your backup plan. OneCare will only backup data files, never system files or program files. it also will not look at \Windows or \Program Files for locations to backup data files from.
This KB article lists the file types backed up and not backed up:
http://support.microsoft.com/default.aspx/kb/943776/en-us
-steve
Microsoft MVP Windows Live / Windows Live OneCare & Live Mesh Forum Moderator