I think I see your issue, you have a local drive that you want to back up to, yet, your SQL Server database is on a Cluster that does not see that local drive (probably because it is connected to the San box).

This situation will require you to use UNC naming as there is no guarantee that the local server will be the active server in the cluster. This basically mean that you will have to backup over the network even though this is a local drive because SQL Server does not see the local drive since it is not part of the cluster.

The next issue you will face is backing up over the network. Not a very good way to accomplish backups as SQL server is not very tolerate for small network hiccups that always occur.

The best way to do this is to backup to the cluster and then utilize xp..cmd shell to move the file using UNC to the drive on the local machine to your target backup drive.

Remember, Clusters are very different from stand alone servers. The best way is to think of the cluster as it's own server as it is very independent of the nodes hosting it.

Hope this helps