Deduplication would be a feature of the underlying storage platform. For example, if you are using FreeNAS to store your backups, when configuring a ZFS dataset you can choose the compression level. This compression runs at the storage level and would be in addition to any compression performed by the backup job.
Does this answer your question?
Yes, Thinware vBackup works with the hypervisor which then processes many of the commands required to perform backup operations. By utilizing the hypervisor this allows Thinware vBackup to perform backups of VMs without the need to install any type of agent software in the VM.