We do not have experience with the Vault
tool with Sitefinity, but when we are talking about parent folder of a web site - it is the same as projects name. In your case Project1
is the root directory which contains all information connected with the web site.
As for your question about deploying a project to another machine, please check section Migrating Projects to the Production Web Server
of the Sitefinity User Manual.
Hope this helps.
the Telerik team
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