Hello,
Where was that DUDF change made, as you can change that in Tools- Options of the DLO Admin Console, but that will only apply for any subsequent Profiles created ? If there were profiles that were already created, the path will need to be changed in each of those, to affect the users that use those.
You can check what path the DLO Agent is expecting to use, by checking the Tools - Options menu and Backup Folders tab of that. If that still shows the default C: drive path, then you need to check the Profile being used by that user, to ensure the new DUDF path has been updated.
If the DUDF path shows correctly in the Profiles and at the Agent side, but you are still seeing disk space issues, due to DLO, we will need to check what is taking the space...