Hmmmm is there any chance you configured the Obsidian vaults to be in a parent folder on one of your devices when using Obsidian Sync, and then when Obsidian Sync tried to replicate the folder structure, Dropbox picked it up and synced it across, causing infinite recursion?
In general, we don’t encourage using two sync providers to sync the same set of files across the same set of devices. In that case, race conditions could cause file corruption, duplication, or worst case… well unknown issues like this one.
You can, however, still have a backup copy of your vault in Dropbox by only using Dropbox on your primary device (in this case, your mac) and have Obsidian Sync keeps everything in sync, so as to avoid the conflicts between two sync services.
More docs here: Obsidian Sync
As for file recovery, Dropbox should have a 30-day version history like WhiteNoise mentioned that should make it possible to recover any files that was deleted, but I suspect your files aren’t really deleted; they’re just completely shadowed by the weird folder structure that was generated when the two sync solution conflicted on a parent/child nested vault structure.
I would recommend pausing Dropbox & Obsidian Sync immediately, then try to navigate the folder using your system file explorer and try to clean the mess up.
If you are successful in cleaning it up, I would recommend setting up a new clean Obsidian Sync remote vault (and eventually deleting the old remote vault) to avoid contaminating the data.