iCloud Storage Config: Photos
Because you're not using iCloud Photo Library, iOS will treat your Camera Roll photos and any saved photos as part of the standard backup process. 

You are storing all of those backed-up photos in a separate backup in your iCloud Storage (the dark blue part of your storage bar). This means that you are correct in suggesting you are "double-storing" your photos.

If you were to delete your backup from iCloud (I recommend backing up the photos on your physical device to external storage before you do this) and then turn on iCloud Photo Library, your photos would be uploaded to iCloud and then would not need to be backed up by the device. 

Here is my current storage as an example: 



You can see that my photos and videos are taking the majority of my storage while my backups are only a small part.

In short: Delete your backup from iCloud (after backing up photos), turn on iCloud Photo Library, then after the photos have been uploaded, backup your device again.