Hi,
source code is like every other data - you should back it up regularly. You have to do the same on every PC or Linux system, otherwise you will lose it in case of a system failure.
A good strategy is to do daily backups of ALL libraries and objects that change daily. If you are doing daily changes on source code, you should do daily backups of the source code. Whether you use version control or not.
We are going a step further and have ALL source code files under journals and do replication to another machine - the same way we do that with our databases. But even that is no replacement for a backup.
For using GiT with IBM i source files, there are solutions. Of course you can "manually" export your sources into an IFS directory and have GiT there - or you can use a commercial solution like iForGit (by Richard Schoen) which makes this a lot easier and might be a better fit for your workflow.
The last solution would be, to move your sources into the IFS permanently. Most compilers on IBM i can compile directly from IFS. You can create you own structure and add all that to GiT. You will lose the typical "member comments" as those aren't available in IFS. But you might be in a better position with IBM Project BOB. But you still have to do backups regularly - GiT is not a backup - it's version control.
So - there is no silver bullet, and also no best practice. You should evaluate all solutions a choose the one, that fits you and your development team most. iForGit can be a good solution to evaluate everything.
HTH
Daniel