I've asked the team for clarification and will get back to you shortly.

First the data set is transferred completely to the local storage target, and then the data is moved to the cloud. So if you're not seeing any internet activity it's likely that the local backup is not completed yet.

Is there any indication in the status area when the cloud upload starts? It looks like the file path may be different. It does seem that I can change the bandwidth limits in real time so that helps.

Not as such. What you will see in the detail section of the backup plan is that it goes through the list of files twice: First for local and then for cloud. I will add a feature request to have the stage of the hybrid backup more clearly indicated in the backup plan activity section.