Hi,
anwering the second question first.
For the backup you need to enable either the "Drive-based encryption" in the backup specification or in the device configuration (I personally recommend to enable it for both - just in case someone else does DP administration and miss this topic). The key will be stored in keystore - part of internal database. I recommend to export the key from time to time and to store it in a safe.
To verify that a media is encrypted and cannot be decrypted from someone else, install a test cell server without importing the keys from your production cell server. Try importing the medie; you will get a message that media cannot be decrypted. Another test would be an offline disaster recovery. In this case the restore process asks for the key...
And the other question, no, I think you need a new library in this case. Ask your supplier / HP partner to check the quickspecs depending on your model.
Best regards
Daniel