The only reason you might need to keep the "Windows.Old" folder is if it contains files (bookmarks, settings, etc.) from your old Windows installation that you don't have backed up elsewhere or haven't already extracted. If so, I suggest that you do that now.
The reason you have been unsuccessful in trying to delete the "Windows.Old" folder is because you were trying to do it from Windows Explorer. Apparently this is forbidden. The steps that you need to follow to delete this folder are listed here (note that you may have to run Disk Cleanup as an Administrator—right-click on the shortcut and then on "Run as Administrator"):
1. Open Disk Cleanup by clicking the Start button. In the search box, type
Disk Cleanup, and then, in the list of
results, click Disk Cleanup.
If
you're prompted to choose a drive,
click the drive you just installed
Windows on, and then click OK.
2. In the Disk Cleanup dialog box, on the Disk Cleanup tab, click Clean up
system files.
If you're again
prompted to choose a drive, click the
drive you just installed Windows on,
and then click OK.
3. Select the Previous Windows installation(s) check box, and any
other check boxes for the files you
want to delete, and then click
OK.
In the message that appears,
click Delete Files.
If you're a command line junkie, you can also take ownership of the folder using takeown
, but if you're really a command line junkie, you already knew this.