You can see the definition in MSDN at Environment.SpecialFolder :
ApplicationData
The directory that serves as a common repository for application-specific data for the current roaming user. A roaming user works on more than one computer on a network. A roaming user's profile is kept on a server on the network and is loaded onto a system when the user logs on.
or from the old "Official Guidelines for User Interface Developers and Designers" :
- Program Files
To store your application's read-only files, create a subfolder within the Program Files folder.
Include your application's executable (.exe) files as well as any .dll files, Help files, clip art or
other fixed library files, and other support files used by your application. You can use the
Common Files subfolder for any shared components (such as .dll files). For files that you do not
want the user to access directly, set the hidden file attribute.
Also consider the layout of files you provide with your application. In addition to the
recommended structure for your main executable file and its support files, you may want to
create special folders for documents, templates, conversion tools, or other files that the user
accesses directly.
- Documents and Other User-Created Data Files
Save all user-created document files in the My Documents folder. Use this as the default location
for your application's Save As dialog box. Save all user-generated images in the My Pictures
subfolder. Avoid creating your own subfolders in My Documents and My Pictures unless your
application generates multiple related files for user-created data. In that case, it may be better
to develop a structure that keeps the associated files together.
- Application Data
Create other miscellaneous files that the user doesn't directly access in the Application Data
folder. For example, include custom dictionaries, mail stores, user history and other caches,
index files, and log files. If you provide multiple applications, within the Application Data folder
you can create a folder with your company's name that contains subfolders for each product.
The system provides three Application Data folders for the following types of files:
- User Name folder (for example, for Windows 2000, C:\Documents and Settings\user
name) — Store per-user customization files. - Local Settings folder — Store per-user files that do not apply when the user roams, such
as discardable data or temporary files. - All Users folder — Store local application data common to all users, such as log files,
hidden databases, and index files.