I tried the symbolic link and that doesn’t work because OneDrive follows it too when syncing files.
As you say, you can actually disable syncing (“backing up”) of the Documents folder. It just took me a while to find, as they changed how it worked since last time I used it. So removing Documents did the trick, but now my niece doesn’t have a standard Documents folder for putting, well you know, DOCUMENTS! I just created a Documents folder on her Desktop and told her to put her files there.
I think Sims using that folder by default is fine, whatever their reasons are, but I think they should also have an advanced setting, so power users have other options.
I don’t think Steam has this issue.