The profile that matters is stored under Roaming. The one under Local is just a cache.

What sequence of events led to the loss of Local Folders? A simple backup should, obviously, be non-destructive, so something else has happened.

I was backing up my files to an external drive. Not being too sure which profile needed to be backed up, I always copied the Local and Roaming profiles. Somehow this time the important profile got moved and all my past messages went missing. Of course Thunderbird created all new profiles. It took my some time to backtrack my actions, but I found the missing profile. I have downloaded the most recent instructions about profiles, which have always been confusing because they are in several places - Local and Roaming. Like you pointed out, only the profile in Roaming is important. That profile is now backed up. Thanks.