Can't get rsync over sftp to work

rsync doesn't do SFTP. From the man page:

   There  are  two  different  ways for rsync to contact a remote system:
   using a remote-shell program as the transport (such as ssh or rsh)  or
   contacting  an rsync daemon directly via TCP. 

SFTP doesn't give you a shell, ergo it doesn't work for rsync. You'll need an SSH connection instead.

Once you've allowed SSH connections, you may need to specifically tell rsync to use SSH. There are a few ways to do that:

rsync -aHvhiPb --rsh=ssh  /var/www/ [email protected]:./

or

rsync -aHvhiPb  "ssh -l ubuntu-backup"  /var/www/ backup.example.com:./

There are a lot more examples in the man page for rsync.

In the second example, it's syncing the files into a directory named [email protected] located in the direct. In order to specify a remote server, you should use a colon somewhere in the specification.