"System files" is not really a well defined term. It will most probably suffice to just backup
/etc - all system wide configuration files (very space efficient; only text files)
/home the home directories, including personal configuration files
and if you run web/FTP/database servers and so on, their content as well (for me that means
All the files in
/usr are probably what you call system files, as well as the other directories in the system. The exception (at least on Debian based systems, and many others as well) are the
/usr/local directories which contain programs and other things you have installed outside the package system, which you might want to save (but probably you have the installation files for those programs as well).
Save a list of installed packages for easy reconstruction.
If you use backup software that only copies the portions of the files that have changed (e.g.
rsync as you mentioned), the traffic load will be minimal, except for the occasional full backup that you do to make sure everything is in order.
An alternative if you want to be able to quickly restore the entire system is to make complete images, but that's a whole different ball park in space requirements, etc. The abovementioned directories should suffice for a backup.