The EWWW IO Cloud servers do not store your images, they are deleted immediately after optimization, so the benefits are these:
1. reduced load on server
2. improved security – you can disabled exec()
It can also be quite useful for web developers who don’t want to worry about leaving executables on client servers (or #2 regarding exec().
To check if additional folders have been optimized, you check the Bulk Optimize page. After you have run Scan & Optimize, you can click the Show Optimized Images button to see everything it did.
Note: if you are using multisite WP, but activating the plugin per-blog instead of network-wide, there is a bug that affected the additional folders function. It is fixed in ‘dev’ and will be released this week.