Hmm I have a idea how you should be able to get anything back to normal but it requires a Windows XP CD.

Basically, put the CD in your drive, open a command line window and type in sfc /scannow
This should start a Windows integrity check and replace all changed files with original ones, afterwards everything _should_  be normal again!

I hope it works out for you^^

Also about deleting the folder, in theory it should do no harm, unless the transformation pack did something very stupid and relinked core Windows files to its own folder... so try SFC first^^