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The term "Backup" means the methods and processes involved to copy computer data (system data as well as application data) to media other than the ones where the data originally live (disk, tape, optical, cloud). "Restore" in turn means the methods and processes involved in data recovery, i. e., bringing back copied computer data to their original location. Backup/Restore primarily serves as a means of protection against data loss, be it due to disaster, corruption or sabotage. It can also be used for recovering data from an earlier point in time and even for cloning machines or applications. There is a wide variety of backup/restore software available, from expensive commercial products to free or open source tools.
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If you doing full system backup, software needs to create system snapshot and move it over to external location.
Since Dropbox is installed on local drive this will not work.
You can try to go to Dropbox / Sync and Move location of your Dropbox folder to different drive, like D: or E: or network location, then you can try run your backup again.
I assume that capacity of your dropbox folder in Cloud is big enough to handle whole system backup