The OS has dynamic and manual ways of assigning drive letters plus some special predefined allocations.
Upon installation the Windows OS will assign the drive letter C: for the OS drive and if your computer has a floppy drive, the A: volume letter will be assigned by default.
Any additional drive added into the system that has a compatible file system detected, the OS will allocate the next available drive letter. So if for example you have "C" allocated to the system, "D" to your data drive, and you plug a USB, the next available letter will be "E".
In the WinRE the X: drive letter is a ram-disk, a volume that resides in-memory, where the entire pre-installation environment runs. As for the volumes detected by the WinRE on you physical disks they will shift to their next letter.
In the previous example you C drive will become D and D will become E and so on.