Helping people with computers... one answer at a time.
Windows Setup may leave the prior installation of Windows on your hard disk as a backup safety measure. I'll discuss and then delete it.
I am using Windows 7 and one time I had to reinstall it.
I reformatted the drive but it tells me that the drive can't be formatted because there is an operating system on the drive, so I re-install over the old OS but during the installation process, it informs me that the installation will backup the current OS in a folder called "windows.old"! I install correctly and everything works normally. I thought formatting was supposed to wipe the drive so a fresh install could happen, but windows won't let me delete the entire "windows.old" folder - apparently there is something in it that is system sensitive and off limits.
My question is, why does the new install create that "windows.old" folder and if it is safe to get rid of it(I understand it is!), how do I manage that?
A reinstall of Windows should allow you to reformat the drive. It may warn you that there's an operating system already on the drive - as it should - but ultimately you should still be able to indicate that you know what you're doing, and that the drive should be erased.
If you bypass that and install without the reformat - as apparently you have - Windows setup basically tries to be helpful by saving the prior installation.
Getting rid of it, if that's what you want, should be fairly easy.
I'm not sure exactly what steps you took or which messages you saw that would prevent you from actually formatting the hard drive and erasing everything on it as part of Windows setup. Yes, if you attempt to run the "Format" command from within Windows, that cannot work - you're asking Windows to erase the hard disk it's running from, and it simply cannot do that. Windows Setup, however, most certainly can when booted from the installation media.
This article - What are the steps to upgrade Windows XP to Windows 7? shows the basic reformat and install steps for Windows 7. The important thing is to choose those options which cause Windows Setup to reformat the hard drive - erasing everything on it - prior to installing Windows.
If you don't use Windows Setup to reformat your hard drive, and you choose a "custom" installation, Windows Setup will save your previous Windows Installation in a folder named "windows.old". I'll be honest, and admit that I don't know exactly what is saved there. I've read that it can be used to restore your machine to the prior installation, but I've never used it. I very much prefer, and strongly recommend, using a system backup prior to the installation to preserve the entire prior state of the machine should you need to revert.
So, if I see it, I delete it, but first...
The fact that you can't delete it concerns me a little. To diagnose this I would:
Rename "Windows.old" to something else.
See what fails.
It's possible, I suppose, that you might need to reboot into safe mode to be able to rename the folder, but I'm thinking probably not.
If a file in use was preventing the folder from being deleted, having renamed it should cause whatever was using it to no longer be able to find it. You might now see an error related to that.
There's no way for me to know what might happen at this point. Depending on what fails you might now know to make a change of some sort, you might do nothing, or you might end up renaming the folder back. But you should have some more information on why you were unable to delete the folder in the first place.
Once that's understood, you can decide to delete the folder.
In your case, I don't know if you're appropriately backed up or not, so I'll fall back on my standard recommendation before deleting anything you're uncertain of is to make a copy; back it up somewhere. Copy the entire folder elsewhere, just in case. That way if you find out some time later that you really wanted it, you can restore it from this saved backup copy.
If you still get an error deleting the folder, make sure you are logged in as administrator, and are running a Windows Explorer instance as the administrator. In Windows 7, right click on the Windows Explorer icon in the task bar, right click on the Windows Explorer item in the resulting popup menu, and then click on Run as administrator.
Alternately you can also fire up a Windows Command prompt using a similar sequence, and enter the following commands (highlighted in bold):
C:\Users\LeoN> CD \
C:\> RD /s Windows.old
BE CAREFUL: make sure that it's Windows.old you're deleting, and not Windows itself.
That could have you starting the whole installation over again, from scratch.