Help: Documents Folder all of a sudden empty

Hello, I had a weird issue where one day all of a sudden my local Documents folder shows up as empty. However all my files are still in the Documents folder under iCloud. In the past, I just save my documents to the local hard drive Documents folder and iCloud syncs it.

The really weird thing is I saw in Preferences, under iCloud sync, the option to sync "Desktop and Documents Folder" was always UNchecked since I initially setup my Mac 3 years ago.

So now I check that preference box hoping my documents show up again locally under the Documents folder, but it had the reverse affect where my local Documents folder is completely gone...the folder that was empty is now completely gone.

So my question is:

1. Why did my local Documents folder all of a sudden become empty without any change in settings?
2. How do I go back to the way I was working before where I save down my files to the local Documents folder, and the Mac simply then syncs to iCloud? ie. I want my files locally and backed up to iCloud documents

Thank you.