Existing backups won’t be touched. You need to delete them manually if you want to free up space.
Only from the selected backup location.
The description of the s3_disable_cleanup setting needs an update. It disables the removal of backups from S3 and makes the system ignore the value of maximum_backups when backup_location is set to S3.
I think we could actually remove the s3_disable_cleanup setting and allow disabling the cleanup by setting maximum_backups to 0. That would make it work for all backup locations the same way.