I have always asked about this very topic! In my opinion, they're not really necessary. But it depends on the build. If it is heavy gameplay mechanics or heavy roleplay. I think if you are going to have one, it can't overwhelm the build and it actually has to be enough to inform the reader and set up the rest of build. But the best advice I've gotten was from Vazgen. He said "Just have one and leave it up to the reader because so people may read them and some won't." This matters because if you don't have one, then no one can read it, but if you do then anyone who doesn't want to read it can merely scroll past.
The Obsidian Sentinel has backstory. It's masterfully woven into the build itself, which is just the type of short but detailed description that I'm talking about. He starts off with:
Deep in Skyrims most frozen labyrinth, entombed within the heart of a mighty glacier, sleeps the Obsidian Sentinel.
Few know what forbidden sorcery went into its creation or recall the name of the hero enslaved within the dark joints of the symbiotic black armor.
Now a growing evil far to the east of Skyrim has roused this silent guardian from slumber, and as the ice breaks a disturbing tremor is felt throughout the minds of every mage in Tamriel...
That's some basic flavour text to whet your appetite. With a few sentences, he's conveyed that this is some sort of silent stalker who was roused from an eternal sleep. Then in the build itself:
The Obsidian Sentinel is a character that has ultimately become trapped by its own power. The build allows for 100% absorption of all spells, poison and disease but such strength comes at a high price in the form of stunted magicka (0% magical regeneration). This terrible curse forces the Sentinel to be what I always intended it to be…a parasite, a being that is drawn unstoppably to magical energy.
And there he completes the description. A power-hungry stalker with a curse. Single-mindedly drawn to all sources of power.
This "story" is exactly detailed enough, without going into tons of specifics. I immediately know how this guy is supposed to be played (silent, unstoppable stalker) and how he thinks (power... must have POWER...). I also know how he got that way (cursed).
The Nightguard's backstory is far too long for me. I like the idea of it, and it really sets the stage for what the build is about, but it could be tightened up and the same story written in about half as many words.