How do I tell iTunes not to back up apps?
Back up apps is probably a wrong wording as you don't want to store the apps at all on your iTunes, if I understood you correct.
One option could be, to disable app sync. However, all apps are then probably deleted from your device and you have to download all of the again on your device again. If your apps will be deleted from your iOS device, you also will lose all the application data. Also the application data wont be backed up then to your iTunes (but could be backed up to iCloud).
Although you can redownload apps for free, you should keep in mind, that a developer (or Apple) can also remove an app from sale. It is then no longer possible to redownload the app. If you still have the app in your iTunes you still can continue to use it.