'System Data' disk use has massively increased overnight

I can see similar versions of my question have been asked before but I can't find an answer that has worked for my particular problem.

I have been tidying up the image files stored on my iMac and mobile hard drives. I have created 2 new Photos libraries that are stored on a plug-in hard drive and they're also slowly but surely being uploaded to iCloud (I have the 2Tb option so plenty of space).

I have been monitoring the uploading and also keeping a check on my hard drive disk space as I'm tidying things up by deleting a huge number of duplicated and unwanted image files.

This morning I had a look to see the progress overnight and I noticed the System Data had increased from about 50-60gb (can't exactly remember but I had lots of spare disk space) to 750gb, meaning my hard drive was pretty much full.

Following online info I deleted all the stuff recommended (cache, installers, application support, Time Machine snapshots, out of date stuff) and as that made little difference I bought Daisy Disk.

Please can you help by looking at the screenshots which show the disk info in System Preferences and the Daisy Disk results showing that 668gb is Mobile Documents/iCloud Drive which I don't want to delete as its where I'm uploading my image files but also that isn't the Mac's hard drive where System Data is stored. I fee like I'm missing something obvious but my tired head can't get any further!!

I'm running Ventura 13.3 on my iMac 2019 (3.6 GHz Quad-Core Intel Core i3 8 GB)