Dropbox silently moved my Dropbox folder and enrolled me in a beta program without asking!

Thanks Nancy, I don't know how I joined the beta program, I have no recollection of that.

Is the beta program currently tied to Dropbox for macOS on File Provider - i.e. do I have to be on the beta program to use Dropbox for macOS on File Provider for now? Or are they independent?

In the meantime, I contacted Arq Support to ask about how backup works when files are managed using Apple's File Provider API. They said that Arq 7.21 now includes the ability to either "ignore" or "materialize" dataless files. If I choose "materialize", Arq will force the files to be downloaded before backing them up. This is great news, as it sounds like someone has at least thought about how these two capabilities (sync and backup) work together. They also confirmed that Arq will de-duplicate the data backed up from both the new Dropbox location and the old Dropbox location, as long as they're part of the same Arq backup plan. This is important as it means my Arq storage costs won't suddenly double as a result of the Dropbox folder move!

Since I have 500 GB of data and 120,000 files, I don't really want to re-download everything to the new Dropbox folder. This is partly due to time, but also because I have concerns about preservation of metadata (including file creation/modification timestamps: in the past I've seen this metadata change when recovering data via Dropbox, not sure if the File Provider model is different in that respect?)

Given these concerns, what I'd really like to do is the following:

1. Temporarily stop using the Dropbox for macOS on File Provider, and point Dropbox at my old Dropbox folder
2. Let Dropbox automatically upload all the changes I've made in macOS over the last 11 days from my old Dropbox folder to the Dropbox cloud. The changes I've made on other devices should be preserved as they all involve separate files, thankfully, so there should be no conflicts. 
3. When the time is right, re-initiate migration to Dropbox for macOS on File Provider - but this time, do it in the correct way as you described, so that my existing data is moved to the new location in a controlled manner, rather than everything being re-downloaded
4. Configure Arq to "materialize" dataless files, as described above
5. Add the new Dropbox folder to my existing Arq backup plan

By doing it this way, it will ensure that (a) all my file metadata is preserved correctly; (b) I avoid re-downloading 500 GB of data; and (c) the data in my new Dropbox folder continues to get backed up correctly.

Do you think this plan should work - and if so, how do I perform steps 1 and 3?

As a side note, I think it's important for the folk at Dropbox to understand that Dropbox doesn't exist in a vacuum. It needs to co-exist with other needs - in particular, the ability to back up the same datasets using a variety of 1st and 3rd-party tools. When you move the Dropbox folder to a new location and change the sync model, that can be a seriously disruptive change from that perspective, and needs to be handled very carefully.