Moving Maildir directory out of /home

I have a computer with Ubuntu 13.04 with a local IMAP server that I use to share email over the LAN. I set this computer up to have an encrypted /home, however this therefore means that anyone logging into the server won't be able to view the IMAP folders unless the local user is also logged in. I want to therefore move the mail to /var/mail/Maildir/%u.

I have the following in my /etc/dovecot/conf.d/01-mail-stack-delivery.conf

mail_location = maildir:/var/mail/Maildir/%u

And my /etc/postfix/main.cf has:

home_mailbox = Maildir/

However when I log in locally with a mail client over IMAP, it recreates the ~/Maildir directory instead of using /var/mail/. What am I missing?

Edit:

Here is my postconf -n after applying shutupsquare's answer:

alias_database = hash:/etc/aliases
alias_maps = hash:/etc/aliases
append_dot_mydomain = no
biff = no
broken_sasl_auth_clients = yes
config_directory = /etc/postfix
inet_interfaces = all
mailbox_command = /usr/lib/dovecot/deliver -c /etc/dovecot/dovecot.conf -m "${EXTENSION}"
mailbox_size_limit = 0
mailbox_transport = dovecot
mydestination = $myhostname, $mydomain, localhost.$mydomain, localhost, localhost.localdomain, ubuntu
myhostname = host
mynetworks = 127.0.0.0/8 [::ffff:127.0.0.0]/104 [::1]/128 192.168.1.0/24
readme_directory = no
recipient_delimiter = +
relayhost =
smtp_tls_session_cache_database = btree:${data_directory}/smtp_scache
smtp_use_tls = yes
smtpd_banner = $myhostname ESMTP $mail_name (Ubuntu)
smtpd_recipient_restrictions = reject_unknown_sender_domain, reject_unknown_recipient_domain, reject_unauth_pipelining, permit_mynetworks, permit_sasl_authenticated, reject_unauth_destination
smtpd_relay_restrictions = reject_unknown_sender_domain, reject_unknown_recipient_domain, reject_unauth_pipelining, permit_mynetworks, permit_sasl_authenticated, reject_unauth_destination
smtpd_sasl_auth_enable = yes
smtpd_sasl_authenticated_header = yes
smtpd_sasl_local_domain = $myhostname
smtpd_sasl_path = private/dovecot-auth
smtpd_sasl_security_options = noanonymous
smtpd_sasl_type = dovecot
smtpd_sender_restrictions = reject_unknown_sender_domain
smtpd_tls_auth_only = yes
smtpd_tls_cert_file = /etc/ssl/certs/ssl-mail.pem
smtpd_tls_key_file = /etc/ssl/private/ssl-mail.key
smtpd_tls_mandatory_ciphers = medium
smtpd_tls_mandatory_protocols = SSLv3, TLSv1
smtpd_tls_received_header = yes
smtpd_tls_session_cache_database = btree:${data_directory}/smtpd_scache
smtpd_use_tls = yes
tls_random_source = dev:/dev/urandom
virtual_alias_maps = hash:/etc/postfix/virtual

Edit 2: my /var/log/mail.log contains the following:

May  4 02:10:01 servername postfix/local[469]: warning: connect #7 to subsystem private/dovecot: No such file or directory
May  4 02:10:11 servername postfix/local[469]: warning: connect #8 to subsystem private/dovecot: No such file or directory
May  4 02:10:21 servername postfix/local[469]: warning: connect #9 to subsystem private/dovecot: No such file or directory
May  4 02:10:31 servername postfix/local[469]: warning: connect #10 to subsystem private/dovecot: No such file or directory
May  4 02:10:41 servername postfix/local[469]: fatal: connect #11 to subsystem private/dovecot: No such file or directory
May  4 02:10:42 servername postfix/qmgr[30763]: warning: private/local socket: malformed response
May  4 02:10:42 servername postfix/qmgr[30763]: warning: transport local failure -- see a previous warning/fatal/panic logfile record for the problem description
May  4 02:10:42 servername postfix/master[30759]: warning: process /usr/lib/postfix/local pid 469 exit status 1
May  4 02:10:42 servername postfix/master[30759]: warning: /usr/lib/postfix/local: bad command startup -- throttling