standard error wont go to standard output unless it is redirected. and standard error, by default, is the display. standard error is also the display, by default.
so in the absence of curly brackets: the output from the fbackup command should go to the tcio command. the errors from fbackup command should go to the display. the errors from the tcio command should go to the standard output.
of course if the standard output is not redirected, all of this will appear on the display. it will look as if the curly brackets did not achieve anything.
you can see the difference when you put that line in a shell script (say 'mybackup') and execute it with stdout redirect with '>' to a file (as 'mybackup > mybkp.log'). try it with and without the curly brackets. make sure you give fbackup enough to complain about, else you wont have any errors!
here is a simple example:
--------------------------------------------
bash-2.01$ cat bkt.sh
#! /bin/sh
touch file1
rm -f file2
ls -l file1 file2 | grep file1 2>&1
echo ----
{ ls -l file1 file2 | grep file1
} 2>&1
bash-2.01$ sh bkt.sh > log
file2 not found
bash-2.01$ cat log
-rw-rw-r-- 1 rangarc lang 0 Jan 29 13:11 file1
----
file2 not found
-rw-rw-r-- 1 rangarc lang 0 Jan 29 13:11 file1
bash-2.01$ sh bkt.sh
file2 not found
-rw-rw-r-- 1 rangarc lang 0 Jan 29 13:11 file1
----
file2 not found
-rw-rw-r-- 1 rangarc lang 0 Jan 29 13:11 file1