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Aug 27, 2016 1:52 PM in response to markfrompulboroughby Tesserax,I don't have my Mac handy to verify, but I believe Time Machine does back up your iCloud Drive folder to a number of folders in: ~/Library/Mobile Documents. As you already know, there are a number of pre-defined folders on the iCloud Drive.
If your spreadsheet is not one of those that has a pre-defined folder, the file restore process will not be as straight forward as opening the iCloud Drive folder, and then, entering Time Machine.
The following Apple Gazette article, hopefully, will shed some more light on how you can access iCloud Drive files via Time Machine.