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C:\>systeminfo | findstr "Directory"
Windows Directory:         C:\Windows
System Directory:          C:\Windows\system32

What is the difference between windows directory and system32 directory?

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Windows 8.1 directory structure: enter image description here
source from wiki

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The Windows directory is the fundamental location for your Windows installation. If you perform a custom install of Windows and you don't format the destination partition the installer will rename the previous version of the Windows directory to Windows.old, thus you will then have two Windows folders (source: http://windows.microsoft.com/en-gb/windows7/how-do-i-remove-the-windows-old-folder). Note that this doesn't mean you will be able to boot to two different versions of Windows.

The System32 directory contains a number of system files that your Windows installation uses.

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