What is "Keep the last X of backup copies"?
If you specify "Keep the last 3 backup copies," then the backup program creates 3 backup folders in the destination folder, such as:
"Backup_3" is the last backup copy,
"Backup_2" is the previous backup copy,
"Backup_1" is the earliest backup copy.
"Deleted_Files" : When some of the files in the source folder have been deleted, the old backup copies of these files which are in the destination folder will be moved from this folder. You can manually delete the folder.