The Advanced Editor is available in Backup 1.5.0 and greater. The Advanced Editor allows you to add and remove file selections from your backup in ways the Simple Editor cannot. This generates a custom_paths.json file within the special://home/addon_data/script.xbmcbackup folder. An example config file is available here.
Sets
A set is a root folder with a series of files/folders underneath you want backed up. This can be as macro (entire UserData folder) or as micro (specific addon) as you want.
Creating a set will allow you to name it and then set a root folder for inclusion. Because of how Kodi handles it's file browser I couldn't just let you browse the system carte blanche. You can either choose to select a folder within the "special://home" directory (default) or type your own path to start as the root.
Including Folders
By default the root folder and all files and sub folders are added to the set. You can modify this by removing the root include entry and then creating your own folders to include from within the root.
Toggling the Sub Folder option allows you to stop the Backup addon from including folders below the one you've chosen. This essentially means you want only the files from this folder but nothing more.
Excluding Folders
Excluding folders works about how you'd expect. Choose a folder and this folder, plus everything in it, are ignored.