[Azred]

Keep the copied folder exactly where it is and don't touch it. You need to either use Add/Remove Programs in the Control Panel to uninstall the game--this will remove the registry entries since it won't find the main files you moved (the easy method) or you'll have to remove the registry entries yourself (the "hard" method--really not hard, just time-consuming). Once you have done this, you may reinstall the game...but reinstall it to a different directory than before, like C:\Icewind Dale.

You should be able to move your characters over easily; the worst that might happen will be some text mistakes if you have any HoW items or spells.