[iOS] does disabling iCloud backup via app assignment work?

Unfortunately, I don't that that method works for your intent. I'm not even sure what it's supposed to do myself. It may only apply to Microsoft's own apps and supporting third-party/Intune-branded apps.

Apple is frustrating because they don't give you an alternative or granular control. It's either disable iCloud all together (which you can do), or have iCloud on. 

To disable iCloud altogether: Under the Restrictions Template, go to General --> "Block modification of account settings" and change this to yes. After that, make sure that profile is assigned directly to all devices (use filters if you need to control which ones have that restriction). That stops people from signing into an apple ID if they have not already done that. Disable it and manage all your app deployments through VPP; users might find it annoying, but it saves a lot of headaches with "I forgot my apple id password; can you reset it for me?"

Note for config deployments: If you use groups, it takes too long for a new device to grab those settings, so users can still log in to an apple ID and have iCloud enabled. By speed "All devices" is the fastest, then "All users" is second, and by a significant margin "Groups" is in last place (whether assigned or dynamic).