It should clean the file in place, after moving the untouched originals into TESV Edit Backup folder inside MO's Overwrite.
Now If you want to keep your Data folder in its original state (which is the whole point of MO) you can "correct" this situation by adding the cleaned files of you Data folder as a new mod inside MO, and then restore the backups plugins (ex: Update.esm.backup) from Overwrites to the Data folder. Don't forget to rename the files to delete the ".backup" extension.
