Is Djed backed by ADA directly or only by Shen? Why would Shen go up in value if ADA goes back up in value after a crash?

DJED is backed by ADA and only by ADA. SHEN are only the coin given to people who put additional ADA in the reserve to reach the overcollateralisation.

pretty sure it's just backed by shen. If djed fails, the initial shen "Accredited investors" get reked (but I don't think signifcant amounts of ADA would get dumped on the market destroying the value of ADA for those not involved with Djed or shen)

Here is a nice place to learn about it https://cotinetwork.medium.com/djed-frequently-asked-questions-f636735be76