safest way is to reformat the hard drive and install everything all over again. You need to back up important files first. If you don't want to do that, then you can just delete the directory that contains the os you do not want, then edit boot.ini file in the c:\ root directory and remove any references to that copy of the os. But of course that will not remove the os from the registry.
I highly doubt Microsoft says "delete the folder you don't want". Just follow their instructions...they have no reason to screw you. You are probably using the "c:\Windows1" folder now because it sounds like the previous (broken) install resided in "c:\Windows" as that is normally the default location for the Windows directory. Delete the old installation's "Windows" folder or rename it if you're afraid it might hurt something. One good thing about Windows is that you won't be able to rename/delete the current Windows folder as the system would be running from it so it should be pretty difficult to screw things up here.
Yeah as much as i don't like the way windows has things set up with their OS sometimes i think we tend to forget that they do make life alot easier on a computer then it would be without an OS. In my experience though considering they wrote the program and know it inside out Microsoft often know what the best thing to do in a situation like this so just delete the folder you dont want like microsoft suggested I dont see it causing problems unless your on the copy you are trying to delete.