Yes: Some will read it and understand and figure out that you have cancelled their order. Most won't.
No: I think you'll lose orders simply by having the words "order cancelled" next to a product description -- just my 2 cents on human psychology there.
If you want to send email communications about backorders and cancellations, I'd write a single, blanket email. I'd state something about,
"This is a general form email meant simply to inform you of a backorder. If the backordered product is not available from the manufacturer, your order will be cancelled. If you would like specific information regarding your order and its status, please contact us by calling 1-800-Example or email us at Info@Example.com. Thank you"
Short, sweet, directly to the point and with no specific information -- no more than 30 seconds for you to push the pre-written email out after pasting their email address into the "To:" field.
You could also just cut the backorder email out and simply send an email for the cancellation. Not as customer service oriented, but just as effective. Those who pay attention will definitely contact you to find out the status of their order after a week or two. Those who don't contact you either forgot or don't mind the wait and probably won't respond to the cancellation email...