Scheduled Backup Fails to Continue on Error

I have the scheduled backup feature set to back up all of my virtual servers to another system using the SSH option. I have the "Action on error" option set to "Continue with other features and servers". However, I received the following error via e-mail:

A new format backup can only be done when all virtual servers have a home directory ( does not)
Backup failed! See the progress output above for the reason why.

Given the settings above, I would have expected the other domains to be backed up, however no backup files exist, other than an empty directory on the target system.

Closed (fixed)