I have never had this problem before with similar technologies (like ClickOnce). In fact, I found the opposite. In general, users are more comfortable with software if they have to answer fewer questions.
For most users, it just doesn't matter where the application is installed. And most do not even understand the consequences of choosing one place over another.
Why burden users with choices that they don’t care and cannot answer in a meaningful way? I know that this does not apply to every user, but IMHO, this is for most.
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