How to sync an additional folder to iCloud Drive similar to how macOS Sierra does it?
Similar answer to one of the others, but in this case I've used a symbolic link to do this rather than use the GUI to create an apple 'Alias', just to be sure it works in all cases.

Rather than add the original Downloads folder into iCloud, I've relied on the standard 'Documents and Desktop' sync option provided by Apple in iCloud without messing around in the background where those files are accessible (~/Library/Mobile\ Documents/com~apple~CloudDocs/) as I'm not confident that adding links in there is a good idea long term.

In terminal (or iTerm2 if you want a more customisable terminal):


Create a 'Downloads' folder in your 'Documents' directory (if you haven't already): mkdir ~/Documents/Downloads
Copy (or move as with this example) your files from the old (presumed to be in ~/Downloads directory to the new Downloads directory: mv ~/Downloads ~/Documents/Downloads
Delete your old Downloads folder (this should require your password, and presumes you are logged in as an administrator): sudo rm -rf ~/Downloads/
Create a symbolic link to your new Downloads folder: ln -s ~/Documents/Downloads ~/Downloads


All those commands again, but without all the extra words :)

mkdir ~/Documents/Downloads
mv ~/Downloads ~/Documents/Downloads
sudo rm -rf ~/Downloads/
ln -s ~/Documents/Downloads ~/Downloads


You will probably have to drag the new Downloads link (or folder) in Finder to the Favourites section/left menu if you want it to display there once more.