We do exactly the same thing as you are proposing. We have it
installed at about 30 sites around the US. Our largest DB is about
200GB. We did all this long before nbackup came along, so we wrote our
own backup utility to do the incremental backups. We have run this on
everything from Interbase 5.x to Firebird 1.5.3. It all works like a
charm.

Database recoveries tend to be a slow, slow, slow process though. We
can recover smaller databases (4-8GB) in a couple of hours. The 200GB
ones tend to take a day or two.