While it is recommended your application install under ProgramFilesFolder (for per-machine packages) or LocalAppData (for per-user packages) some controlled environments expect applications to be installed in very specific locations. The following snippet shows how to install to a folder on the system drive:

<Directory Id='TARGETDIR' Name='SourceDir'>
  <Directory Id='APPLICATIONFOLDER' />
</Directory>

<!-- The casing of 'APPLICATIONFOLDER' and 'WindowsVolume' is very important here.
     Replace 'AppFolder' with the correct name of the folder you want on the system drive.
-->
<SetDirectory Id='APPLICATIONFOLDER' Value='[WindowsVolume]AppFolder' />

If the environment has a known drive letter you want to use, you can modify the last line in the example above with:

<SetDirectory Id='APPLICATIONFOLDER' Value='X:\AppFolder' />